UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    Form 10-Q

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

For the quarterly period ended          September 30, 1998
                                 -----------------------------------

Commission file number                       1-8026
                                 -----------------------------------
[OBJECT OMITTED]
                             GENERAL RE CORPORATION

             (Exact name of registrant as specified in its charter)

         DELAWARE                                      06-1026471
     ---------------                              ------------------  
(State or other jurisdiction of                    (I.R.S. Employer
 incorporation or organization)                   Identification No.)

  Financial Centre, P.O. Box 10350
       Stamford, Connecticut                            06904-2350
 ---------------------------------                --------------------
(Address of principal executive offices)                (Zip Code)

Registrant's telephone number, with area code         (203) 328-5000
                                                  --------------------

                                               
                                    None
                 --------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

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

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date.
                 Class                        Outstanding at September 30, 1998

     Common Stock, $.50 par value                     75,690,007 Shares
---------------------------------------      -----------------------------------


[OBJECT OMITTED]

                             GENERAL RE CORPORATION

                                      INDEX



PART I.  FINANCIAL INFORMATION


                                                                    PAGE
Item 1.    Financial Statements

           Consolidated Statements of Income
           Three and nine months ended September 30, 1998 and 1997    3

           Consolidated Statements of Comprehensive Income
           Nine months ended September 30, 1998 and 1997              4

           Consolidated Balance Sheets
           September 30, 1998 and December 31, 1997                   5

           Consolidated Statements of Common Shareowners' Equity
           Nine months ended September 30, 1998 and 1997              6

           Consolidated Statements of Cash Flows
           Nine months ended September 30, 1998 and 1997              7

           Notes to Consolidated Interim Financial Statements         8

Item 2.    Management's Discussion and Analysis of
           Financial Condition and Results of Operations             11


PART II.  OTHER INFORMATION

Item 4. Submission of Matters To a Vote of  Security Holders 24

Item 6. Exhibits and Reports on Form 8-K

           Reports on Form 8-K (none)

           Exhibit 27  -  Financial Data Schedule                    26









                                                              2

                             GENERAL RE CORPORATION
                        Consolidated Statements of Income
                      (in millions, except per share data)

                                                     (Unaudited)
                                       -----------------------------------------
                                       Three Months Ended      Nine Months Ended
                                          September 30,          September 30,
                                         -------------          --------------- 
                                         1998       1997        1998        1997
                                         ----       ----        ----        ----
Premiums and other revenues

Net premiums written
     Property/casualty                  $1,113     $1,294      $3,599     $4,107
     Life/health                           306        327         925        910
                                       -------    -------     -------    -------
Total net premiums written              $1,419     $1,621      $4,524     $5,017
                                        ======     ======      ======     ======

Net premiums earned
     Property/casualty                  $1,169     $1,338      $3,521     $4,097
     Life/health                           321        327         915        892
                                       -------     ------      ------     ------
Total net premiums earned                1,490      1,665       4,436      4,989

Investment income                          331        321         976        955
Other revenues                              97         88         301        271
Net realized gains                         258          2         292          7
                                        ------    -------       -----    -------

     Total revenues                      2,176      2,076       6,005      6,222
                                         -----      -----       -----      -----

Expenses

Claims and claim expenses                  832        929       2,408      2,858
Life/health benefits                       246        254         675        661
Acquisition costs                          336        355       1,019      1,081
Other operating costs and expenses         187        200         586        609
Goodwill amortization                        7          8          21         22
                                       -------   --------      ------    -------

     Total expenses                      1,608      1,746       4,709      5,231
                                         -----      -----       -----      -----

   Income before income taxes and 
         minority interest                 568        330       1,296        991

Income tax expense                         161         75         331        230
                                          ----       ----        ----        ---

   Income before minority interest         407        255         965        761

Minority interest                           15         11          47         40
                                         -----      -----       -----      -----

     Net income                           $392       $244        $918       $721
                                          ====       ====        ====       ====

Share Data:

Net income per common share:
         Basic                           $5.14      $3.06      $11.94      $8.97
                                         =====      =====      ======      =====
         Diluted                         $4.98      $2.98      $11.59      $8.76
                                         =====      =====      ======      =====

Average common shares outstanding:
         Basic                      75,668,886 78,959,758  76,223,730 79,467,367
                                    ========== ==========  ========== ==========
         Diluted                    78,437,507 81,638,130  78,926,553 81,902,853
                                    ========== ==========  ========== ==========

Dividend per share to common 
    shareowners                         $ .59       $ .55       $1.77      $1.65
                                        =====       =====       =====      =====


           See notes to the consolidated interim financial statements.
                                        3


<PAGE>


                             GENERAL RE CORPORATION
                 Consolidated Statements of Comprehensive Income
                        (in millions, except share data)



                                                              (Unaudited)
                                                           -----------------
                                                           Nine months ended
                                                              September 30,
                                                              ------------- 
                                                           1998           1997
                                                           ----           ----



Net income                                                  $918           $721

Unrealized appreciation (depreciation) of 
       investments, after tax:

     Common equities                                          43            512

     Preferred equities                                        1             25

     Fixed maturities                                        101            133

     Less:   Reclassification for prior periods'
             appreciation included in current
             period's realized gains                        (144)           -

     Foreign currency translation gains (losses)             (72)            30
                                                           -----          -----

         Comprehensive income                               $847         $1,421
                                                            ====         ======



Share data:

Comprehensive income per diluted common share             $10.70         $17.31
                                                          ======         ======


















           See notes to the consolidated interim financial statements.
                                        4

                             GENERAL RE CORPORATION
                           Consolidated Balance Sheets
                        (in millions, except share data)

                                                   (Unaudited)
Assets                                         September 30, 1998  Dec. 31, 1997
                                               ------------------  -------------
Insurance investments:
  Fixed maturities, available-for-sale (cost:
   $16,180 in 1998; $15,859 in 1997)                      $17,314       $16,847
  Preferred equities, at fair value (cost:
   $845 in 1998; $980 in 1997)                                898         1,041
  Common equities, at fair value (cost: 
   $2,086 in 1998; $2,098 in 1997)                          4,710         4,748
  Short-term investments, at amortized cost
   which approximates fair value                              918         1,172
  Other invested assets                                       866           768
                                                          -------       -------
     Total insurance investments                           24,706        24,576
Cash                                                          296           193
Accrued investment income                                     317           358
Accounts receivable                                         2,100         1,858
Funds held by reinsured companies                             459           488
Reinsurance recoverable                                     2,449         2,706
Deferred acquisition costs                                    499           476
Goodwill                                                      948           968
Other assets                                                  840           962
Financial services assets:
     Investment securities, at fair value (cost:
      $1,421 in 1998; $790 in 1997)                         1,426           792
     Trading securities, at fair value (cost:
      $2,433 in 1998; $1,908 in 1997)                       2,484         1,859
     Short-term investments, at fair value                    482           129
     Cash                                                     147           159
     Trading account assets                                 6,886         4,313
     Securities purchased under agreements to resell          863           903
     Other assets                                           1,102           719
                                                          -------       -------
         Total assets                                     $46,004       $41,459
                                                          =======       =======

Liabilities
Claims and claim expenses                                 $15,669       $15,797
Policy benefits for life/health contracts                     962           907
Unearned premiums                                           1,947         1,874
Other reinsurance balances                                  2,577         2,948
Commercial paper                                               10            -
Notes payable                                                 284           285
Income taxes                                                1,306         1,104
Other liabilities                                             934           997
Minority interest                                           1,063         1,032
Financial services liabilities:
     Securities sold under agreements to repurchase,
      at contract value                                     1,569         1,030
     Securities sold but not yet purchased,
      at market value                                       1,195         1,190
     Trading account liabilities                            5,965         3,664
     Commercial paper                                         805           689
     Notes payable                                          1,455           746
     Other liabilities                                      1,811         1,032
                                                           ------        ------
         Total liabilities                                 37,552        33,295
                                                           ------        ------

Cumulative convertible preferred stock (shares
 issued: 1,688,321 in 1998 and 1,700,231 in 1997;
 no par value)                                                144           145
Loan to employee savings and stock ownership plan            (142)         (142)
                                                          -------       -------
                                                                2             3
                                                          -------       -------
Common Shareowners' Equity
Common stock (102,827,344 shares issued in 1998
 and 1997; par value $.50)                                     51            51
Paid-in capital                                             1,153         1,109
Accumulated other comprehensive income, net of
 deferred income taxes                                      2,347         2,418
Retained earnings                                           8,267         7,492
Less common stock in treasury, at cost (shares
 held:  27,137,337 in 1998 and 25,393,840 in 1997)         (3,368)       (2,909)
                                                          -------       -------
         Total common shareowners' equity                   8,450         8,161
                                                          -------       -------
         Total liabilities, cumulative convertible 
         preferred stock and common shareowners' equity   $46,004       $41,459
                                                          =======       =======

           See notes to the consolidated interim financial statements.
                                        5


<PAGE>


                             GENERAL RE CORPORATION
              Consolidated Statements of Common Shareowners' Equity
                                  (in millions)
                                                              (Unaudited)
                                                            Nine months ended
                                                             September 30,
                                                        ----------------------
                                                        1998              1997
                                                        ----              ----
Common stock:
    Beginning of period                                  $51               $51
    Change for the period                                  -                 -
                                                         ---               ---
       End of period                                      51                51
                                                          --                --

Paid-in capital:
    Beginning of period                                1,109             1,041
    Stock issued under stock option and other
     incentive arrangements                               29                31
    Other                                                 15                12
                                                        ----            ------
       End of period                                   1,153             1,084
                                                       -----             -----

Accumulated other comprehensive income
    net of deferred income taxes:

    Unrealized appreciation of investments,
     net of adjustment for appreciation
     (depreciation) related to realized gains  
     included in net income
    Beginning of period                                2,460             1,625
    Change for the period                                 62             1,057
    Deferred income taxes                                (61)             (388)
                                                       -----             -----
       End of period                                   2,461             2,294
                                                       -----             -----

    Currency translation adjustments
    Beginning of period                                  (42)              (53)
    Change for the period                                (79)              (44)
    Deferred income taxes                                  7                75
                                                        ----              ----
       End of period                                    (114)              (22)
                                                        ----              ----

    Accumulated other comprehensive income
    Beginning of period                                2,418             1,572
    Change for the period                                (17)            1,013
    Deferred income taxes                                (54)             (313)
                                                       -----             -----
       End of period                                   2,347             2,272
                                                       -----             -----

Retained earnings:
    Beginning of period                                7,492             6,708
    Net income                                           918               721
    Dividends on common stock                           (135)             (131)
    Dividends on preferred stock, net of
     income taxes                                         (8)               (7)
                                                       -----             -----
       End of period                                   8,267             7,291
                                                       -----             -----

Common stock in treasury:
    Beginning of period                               (2,909)           (2,046)
    Cost of shares acquired during period               (454)             (630)
    Stock issued under stock option and other  
     incentive arrangements                               (5)                9
                                                      ------            ------
       End of period                                  (3,368)           (2,667)
                                                      ------            ------

    Total common shareowners' equity                  $8,450            $8,031
                                                      ======            ======

           See notes to the consolidated interim financial statements.
                                        6
                             GENERAL RE CORPORATION
                      Consolidated Statements of Cash Flows
                                  (in millions)

                                                                    (Unaudited)
                                                                   -----------  
                                                               Nine months ended
                                                                 September 30,
                                                                 ------------ 
                                                                   1998    1997
                                                                   ----    ----
Cash flows from operating activities:
     Net income                                                    $918    $721
     Adjustments to reconcile net income to net
      cash provided by operating activities:
         Change in claim and claim expense liabilities             (128     -
         Increase in policy benefits for life/health
          contracts                                                  55     167
         Change in reinsurance recoverable                          257      89
         Increase in unearned premiums                               73      40
         Amortization of acquisition costs                        1,018   1,081
         Acquisition costs deferred                              (1,041  (1,103)
         Trading account activities
              Change in trading account securities               (1,090   1,271
              Securities purchased under agreements
               to resell                                             40    (508)
              Securities sold under agreements to 
               repurchase                                           539    (826)
              Change in other trading balances                      267     (23)
         Other changes in assets and liabilities                    251      59
         Net realized gains on investments                         (292      (7)
                                                                   ----    ----
                  Net cash from operating activities                867     961
                                                                   ----    ----

Cash flows from investing activities:
     Fixed maturities: available-for-sale
         Purchases                                               (5,444  (5,012)
         Calls and maturities                                       499     351
         Sales                                                    4,015   4,514
     Equity securities
         Purchases                                                 (738    (907)
         Sales                                                    1,038     398
     Net sales (purchases) of short-term investments                226    (214)
     Net purchases of other invested assets                         (81     (27)
                                                                   ----    ----
                  Net cash (used in) from investing activities     (485    (897)
                                                                   ----    ----

Cash flows from financing activities:
     Issuance of structured notes                                   679     -
     Commercial paper borrowing, net                                126     619
     Change in contract deposits                                   (471      66
     Cash dividends paid to common shareowners                     (135    (131)
     Acquisition of treasury stock                                 (463    (633)
     Other                                                          (27       8
                                                                   ----    ----
                  Net cash used in financing activities            (291     (71)
                                                                   ----    ----

Change in cash                                                       91      (7)

Cash, beginning of period                                           352     365
                                                                    ---     ---

Cash, end of period                                                $443    $358
                                                                   ====    ====





           See notes to the consolidated interim financial statements.
                                        7
                             GENERAL RE CORPORATION

               NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS


1.   General - The interim  financial  statements of General Re Corporation  and
     its  subsidiaries  ("General  Re")  have  been  prepared  on the  basis  of
     generally accepted accounting principles and, in the opinion of management,
     reflect  all  adjustments   (consisting  of  normal,   recurring  accruals)
     necessary for a fair presentation of results for such periods.  The results
     of  operations  for any interim  period are not  necessarily  indicative of
     results for the full year.  These  financial  statements  and related notes
     should be read in  conjunction  with the financial  statements  and related
     notes in  General  Re's 1997  Annual  Report  filed on Form  10-K.  Certain
     reclassifications  have been made to 1997  balances  to conform to the 1998
     presentation.   The  operating   results  of  General  Re's   international
     reinsurance operations are reported on a quarter lag.

2.   Income Taxes - General Re's effective  income tax rate differs from current
     statutory rates principally due to tax-exempt interest income and dividends
     received deductions.  General Re paid income taxes of $158 million and $182
     million in the first nine months of 1998 and 1997, respectively.

3.   Reinsurance Ceded - General Re utilizes  reinsurance to reduce its exposure
     to large  losses.  The  income  statement  amounts  for  premiums  written,
     premiums  earned,  claims  and  claim  expenses  incurred  and  life/health
     benefits are reported net of reinsurance.  Direct,  assumed,  ceded and net
     amounts  for the first  nine  months of 1998 and 1997 were as  follows  (in
     millions):

             Property/Casualty      Life/Health        Claims and    Life/Health
             Written    Earned    Written    Earned   Claim Expenses   Benefits

     1998
     Direct  $  398     $  394          -         -       $  329            -
     Assumed  3,797      3,716      $1,043    $1,033       2,397          $766
     Ceded     (596)      (589)       (118)     (118)       (318)          (91)
             ------     ------     -------    ------      ------         -----
     Net     $3,599     $3,521     $   925    $  915      $2,408          $675
             ======     ======     =======    ======      ======          ====


     1997
     Direct    $384        $385        -         -          $310           -
     Assumed  4,376       4,356     $1,059    $1,022       2,929          $730
     Ceded     (653)       (644)      (149)     (130)       (381)          (69)
             ------      ------       ----      ----      ------         -----
     Net     $4,107      $4,097       $910      $892      $2,858          $661
             ======      ======       ====      ====      ======          ====












                                        8

                             GENERAL RE CORPORATION

         NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS (continued)


4.   Per Common  Share  Data - Basic  earnings  per  common  share were based on
     earnings less preferred  dividends,  divided by the weighted average common
     shares  outstanding  during each period.  Diluted earnings per share assume
     the  conversion  of all  outstanding  convertible  preferred  stock and the
     maximum  dilutive  effect of common stock  equivalents.  The following is a
     reconciliation  of the  numerators and  denominators  used in the basic and
     diluted  earnings  per share  calculations  for the three  months  and nine
     months ended  September  30, 1998 and 1997 (in  millions,  except per share
     information) .

                              Income Shares Per share    Income Shares Per share
                              ------ ------ ---------    ------ ------  ------- 
     Three months ended:         September 30, 1998         September 30, 1997
                                 ------------------         ------------------

     Net income                  $392                      $244
     Less: preferred
      dividends                    (3)                       (2)
                                 ----                      ----
              Basic earnings      389  75.7  $5.14          242   79.0    $3.06
                                             =====                        =====
     Effect of dilutive
      securities
     Stock options                  -   1.0                   -    1.0
     Conversion of 
      preferred stock               3   1.7                   2    1.7

     Conversion expense            (1)                       (1)
                                -----  ----                ----
              Diluted earnings   $391  78.4  $4.98         $243   81.7    $2.98
                                 ====  ====  =====         ====   ====    =====


     Nine months ended:          September 30, 1998         September 30, 1997
                                 ------------------         ------------------

     Net income                  $918                       $721
     Less: preferred
      dividends                    (8)                        (8)
                                 ----                       ----
              Basic earnings      910  76.2  $11.94          713  79.5    $8.97
                                             ======                       =====
     Effect of dilutive 
      securities
     Stock options                  -   1.0                   -    0.7
     Conversion of
      preferred stock               8   1.7                    8   1.7

     Conversion expense            (3)                        (3)
                                 ----  ----                 ----
              Diluted earnings   $915  78.9  $11.59         $718  81.9    $8.76
                                 ====  ====  ======         ====  ====    =====

5.   New Accounting Standards - In June 1997, the Financial Accounting Standards
     Board issued Statement No. 131,  Disclosure about Segments of an Enterprise
     and Related  Information.  This statement  requires that  companies  report
     certain  information  about their  operating  segments in their interim and
     annual financial  statements,  including information about the products and
     services  from  which  revenues  are  derived,   the  geographic  areas  of
     operation,  and information  about major customers.  The statement  defines
     operating segments based on internal management  reporting and management's
     method of allocating resources and assessing performance.  The statement is
     effective for year end 1998 and is not expected to change the four segments
     now reported by General Re.






                                        9
                             GENERAL RE CORPORATION

         NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS (continued)

     In June 1998, the Financial Accounting Standards Board issued Statement No.
     133,  Accounting for Derivative  Instruments and Hedging  Activities.  This
     statement  establishes  accounting  and reporting  standards for derivative
     instruments,  including certain  derivative  instruments  embedded in other
     contracts.  It requires that all derivatives be recognized as either assets
     or liabilities  in the balance sheet and measure those  instruments at fair
     value.  If  certain  conditions  are  satisfied,   the  derivative  may  be
     designated as a hedge of an exposure to changes in the value of an asset or
     liability,  variable cash flows for forecasted transactions, or the foreign
     currency  exposure  of the  net  investment  in a  foreign  operation.  For
     derivatives designated as hedging instruments,  net income will be affected
     by the extent to which the  derivative  is not  effective as a hedge of the
     underlying  instrument.  For  derivatives  designated as a hedge of the net
     investment in a foreign operation, the gain or loss on the derivative would
     be included in other  comprehensive  income. For derivatives not designated
     as hedges,  the gain or loss would be recognized in income in the period of
     change.

     The statement is effective for all fiscal quarters beginning after June 15,
     1999.  General  Re is  currently  assessing  the  effect of  adopting  this
     statement  on its  financial  position  and  operating  results.  It is not
     expected, however, that the adoption of this statement will have a material
     effect on General Re's financial position or results from operations.

6.   Berkshire  Hathaway  Merger - On June 19,  1998,  General Re and  Berkshire
     Hathaway  Inc.  ("Berkshire")  announced  that  they  had  entered  into an
     Agreement and Plan of Mergers. Under the terms of the agreement, General Re
     shareholders  will  receive  at their  election  either  0.0035  shares  of
     Berkshire  Class A common stock or 0.105 shares of Berkshire Class B common
     stock for each share of  General  Re common  stock they own at the time the
     transaction  is  consummated.   In  September  1998,  shareowners  of  both
     Berkshire  and General Re approved the merger.  In addition,  the companies
     have received all of the necessary regulatory approvals.

          Berkshire  and  General  Re expect  the  merger to close in the fourth
     quarter,  pending certain tax rulings  requested from the Internal  Revenue
     Service. The agreement provides that if Berkshire and General Re are unable
     to receive  certain tax rulings from the Internal  Revenue Service prior to
     February  19,  1999,  Berkshire  may elect to have an  alternative  form of
     transaction,  under which  General Re  shareholders  will  receive the same
     aggregate value in consideration as stated above, although 3 percent of the
     consideration  would be  received  in cash  rather  than  stock.  The total
     consideration  for  the  transaction,  based  upon  the  closing  price  of
     Berkshire Class A common stock on October 30, 1998, is approximately  $17.5
     billion.















                                                             10
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


MERGER

On June 19, 1998, General Re and Berkshire Hathaway Inc. ("Berkshire") announced
that  they had  reached  a  definitive  agreement  to  merge.  See Note 6 to the
consolidated   interim   financial   statements  for  more  information  on  the
transaction.

CONSOLIDATED

Net income for the third quarter of 1998 was $4.98 per diluted  share,  compared
with $2.98 per diluted  share in 1997.  Net income for the third quarter of 1998
included  after-tax  realized  gains of $2.06 per diluted  share,  compared with
after-tax realized gains of $.03 per diluted share in the third quarter of 1997.
Income from operations, excluding after-tax realized gains and losses, was $2.92
per diluted share in the third quarter of 1998,  compared with $2.95 per diluted
share earned in the comparable  period in 1997. The decline in operating results
for the third quarter of 1998 was primarily due to Hurricane  Georges  losses in
the North  American  property/casualty  operations  and  certain  merger-related
expenses.

Net  income for the first nine  months of 1998 was  $11.59  per  diluted  share,
compared with $8.76 per diluted  share for the same period in 1997.  Included in
net income were after-tax realized gains of $2.34 per diluted share in the first
nine months of 1998,  compared with after-tax realized gains of $.02 per diluted
share in the same period of 1997.  Income from operations,  excluding  after-tax
realized  gains and losses,  was $9.25 per diluted share compared with $8.74 per
diluted  share in 1997,  an  increase  of 5.8  percent.  Improved  international
property/casualty  underwriting  results  and growth in trading  revenues in the
financial  service  operations  were the primary  contributors  to the increased
earnings for the first nine months of 1998.

As required by the  Financial  Accounting  Standard  Board's  Statement No. 130,
Reporting  Comprehensive  Income,  General Re's  financial  statements  for 1998
include a statement of comprehensive  income.  Comprehensive  income consists of
net income,  changes in unrealized investment  appreciation and foreign currency
translation gains or losses.  Comprehensive  income for the first nine months of
1998 was $847  million,  or $10.70  per  diluted  share,  compared  with  $1,421
million, or $17.31 per diluted share for the same period in 1997. The decline in
comprehensive  income for the first nine months of 1998 is primarily due to less
favorable equity markets, which resulted in lower appreciation on investments in
1998, as compared to the same period in 1997.

Consolidated  net  premiums  written  for the third  quarter of 1998 were $1,419
million,  a decrease of 12.5 percent from $1,621  million in 1997.  Consolidated
net  premiums  written for the first nine months of 1998  decreased  9.8 percent
from $5,017 million in 1997 to $4,524 million in 1998.  Adjusted for the effects
of foreign exchange, consolidated traditional net premiums written decreased 5.4
percent and were  unchanged in the third  quarter and first nine months of 1998,
respectively.

General Re's consolidated  underwriting  combined ratio was 103.5 percent in the
third quarter of 1998, compared with 100.3 percent in the third quarter of 1997.
The increase in the combined ratio was due to the effects of catastrophe losses,
principally  Hurricane Georges,  during the third quarter of 1998. For the first
nine months of 1998 and 1997, the consolidated  underwriting  combined ratio was
101.3 percent and 100.6 percent, respectively.


                                                             11
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

Consolidated  pretax  investment income was $331 million in the third quarter of
1998,  an increase of 3.1 percent  from $321 million in the same period of 1997.
For the first nine months of 1998 and 1997,  respectively,  consolidated  pretax
investment income was $976 million and $955 million. The 2.2 percent increase in
consolidated  pretax  investment income in the first nine months of 1998 was due
to the investment of operating cash flow over the last year, partially offset by
the effects of common stock  repurchases  during the second half of 1997 and the
first half of 1998,  dividend payments and the strengthening of the U.S. dollar,
principally against the German mark.

The  consolidated  effective  tax rate was 28.4 percent for the third quarter of
1998,  compared  with 22.7 percent in the third  quarter of 1997.  For the first
nine months,  the  effective  tax rate was 25.5 percent and 23.2 percent in 1998
and 1997, respectively.  The increase in the effective tax rates for the periods
was primarily due to the increase in realized  investment  gains which are taxed
in the United States at the statutory 35 percent tax rate.

Excluding  the financial  service  operations,  consolidated  net cash flow from
operations  was $1,054  million in the first nine  months of 1998,  compared  to
$1,003  million in the same period in 1997.  The  increase of $51 million in the
first nine months of 1998 was due to lower net paid claims,  partially offset by
the  effect  of  the   strengthening   U.S.  dollar  which  decreased   reported
international cash flow.

At September 30, 1998,  insurance  invested assets of $24,706 million  increased
$130 million from $24,576 million at December 31, 1997. The growth was primarily
the result of invested cash flow,  partially offset by common stock  repurchases
and dividend  payments.  The financial service  operations had $4,392 million of
invested assets at September 30, 1998, an increase of $1,612 million compared to
December 31, 1997.  The increase in financial  services  invested  assets in the
first nine months of 1998  results  from  changes in the hedging  activities  of
General  Re  Financial   Products   Corporation   ("GRFP")  and  growth  in  its
match-funded business.

The  consolidated  gross  liability  for  claims  and  claim  expenses  for  the
property/casualty  operations  was $15,669  million at  September  30,  1998,  a
decrease of $128  million  from the year-end  1997  liability.  Adjusted for the
effects of foreign  exchange,  the gross  liability  would  have  decreased  $25
million, or 0.2 percent. The asset for reinsurance  recoverable on unpaid claims
was $2,095 million at September 30, 1998, compared to $2,356 million at December
31,  1997.  At  September  30, 1998,  the gross  liability  for claims and claim
expenses  and the related  asset for  reinsurance  recoverables  include  $2,041
million and $638  million,  respectively,  for  environmental  and latent injury
claims.  These amounts include provisions for both reported and incurred but not
reported claims.

Common  shareowners'  equity at September 30, 1998 of $8,450  million  increased
$289 million, or 3.5 percent,  from the $8,161 million at December 31, 1997. The
increase  was  principally  the  result of net  income of $918  million  and the
reissuance  of common  stock of $38  million  under  employee  compensation  and
benefit  plans,  partially  offset by common share  repurchases of $454 million,
common and  preferred  stock  dividends  of $143  million and  foreign  currency
translation  losses of $72 million.  On a per share basis,  common  shareowners'
equity was $111.64 at  September  30,  1998,  an  increase  of 5.9 percent  from
$105.40 at December 31, 1997.

General Re  repurchased  2,076,600  shares of common  stock from January 1, 1998
through June 18, 1998 for aggregate  consideration  of $454  million.  No shares
have been  repurchased  since the  announcement  of  General  Re's  merger  with
Berkshire. Since the inception of the repurchase program in 1987, General Re has
repurchased 33,902,400 common shares for total consideration of $3.7 billion.



                                                             12
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)


General Re periodically issues commercial paper to meet the short-term financing
needs of its various operations. Commercial paper offered by General Re has been
rated A1+ by Standard & Poor's and Prime 1 by Moody's.  At  September  30, 1998,
General Re had $815 million of  commercial  paper  outstanding,  $805 million of
which was used to support  GRFP's  liquidity  needs and $10  million was used by
General Re Corporation for its liquidity  needs. At September 30, 1998,  General
Re had $2.7  billion in available  lines of credit that provide  General Re with
additional  financial  flexibility and support the commercial paper program. The
credit  lines  consist of a  five-year  credit  facility  of $1.0  billion and a
364-day facility for the remaining $1.7 billion.  The credit agreements with the
participating  banks  require  General  Re to  maintain  a minimum  consolidated
tangible net worth,  as defined,  of $2.7 billion.  To date,  General Re has not
drawn against its corporate credit facilities.

Pretax  income  discussed in each of the segment  sections that follow is before
minority interest deductions and goodwill amortization, both of which are deemed
corporate expenses that have not been allocated to the segments.


NORTH AMERICAN PROPERTY / CASUALTY
(in millions)
                                    Third Quarter               Year-to-date
                                  ----------------           -----------------
                                  1998        1997           1998         1997
                                  ----        ----           ----         ----

Income before income taxes 
 and realized gains                $189       $206            $618        $622
Net premiums written                710        798           1,994       2,320
Net underwriting income             (28)         5            (19)          16

Loss ratio                         71.6%      68.8%           67.9%       67.9%
Expense ratio                      32.5       30.6            33.1        31.4
                                   ----       ----            ----        ----
Underwriting combined ratio       104.1%      99.4%          101.0%       99.3%

Investment income                  $203       $200            $612        $600
Other income                         13          1              24           6
Operating cash flow                 302        361             729         614

Pretax income for the North  American  property/casualty  operations,  excluding
realized  gains/losses,  decreased  8.3  percent  in the third  quarter  and 0.7
percent for the first nine months of 1998, as compared to the respective periods
of  1997.  Operating  income  in this  segment  was  reduced  by the  effect  on
investment income of approximately $1.1 billion of cash flows used to repurchase
common stock and pay dividends  during the past twelve months.  The underwriting
loss in the third quarter was due to losses from Hurricane Georges.

Net premiums  written for the North American  property/casualty  operations were
$710 million in the third  quarter of 1998 and $1,994  million in the first nine
months of 1998,  representing  a decrease of 11.0  percent and 14.1 percent from
the  comparable  1997  amounts.  The  decline in premiums  reflects  the current
competitive market and General Re's adherence to underwriting discipline.






                                                             13
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

The  wholesale  nature  of  reinsurance  transactions  periodically  results  in
somewhat  volatile  premium trends between  quarters and years.  The addition or
loss of a large contract may  significantly  affect General Re's premium growth,
although  large  contracts  generally  have a smaller effect on earnings than on
premium  trends.  General Re's largest  treaty,  which had  annualized  premiums
written of approximately $250 million in 1997 and contributed  approximately one
half of one  percent of  General  Re's 1997 net  income,  was  terminated  as of
September 30, 1997 and thus  affected  premium  comparisons.  Premiums from this
contract  were  included in the first nine  months of 1997,  but were not in the
first nine months of 1998. Excluding this contract,  General Re's North American
premiums   written  declined  3.4  percent  for  the  quarter  and  6.5  percent
year-to-date.  Based on current estimates of premium inforce, General Re expects
North American  property/casualty  net premiums,  excluding  this  contract,  to
decline in the mid-single digits for the full-year 1998.

Net  premiums  written for the General Star  companies,  which  primarily  write
excess,  surplus and specialty insurance,  decreased 14.7 percent in the quarter
and 1.3  percent  in the first nine  months of 1998.  The  decline  in  premiums
written was due to lower  commercial  general  liability and long-haul  trucking
business.  General Star's markets are  experiencing  increased  competition from
insurers  predominantly  writing  standard  coverages  in the excess and surplus
lines market. For the Genesis  operations,  which provide direct excess coverage
to companies  with  qualified  self-insurance  programs,  net  premiums  written
decreased  by 21.7  percent for the quarter  and  increased  2.2 percent for the
first nine months of 1998.

Pretax  investment  income for the North American  property/casualty  operations
increased  1.4  percent  compared  to the third  quarter of 1997 and 2.1 percent
year-to-date.   Investment  income  for  the  North  American  property/casualty
operations grew modestly during the periods due to positive  operating cash flow
in the prior twelve months, partially offset by the effects of share repurchases
and common  dividends.  The overall  pretax total  return on the North  American
property/casualty  investment portfolio was 5.0 percent in the first nine months
of 1998,  compared  with 9.9 percent in the same period in 1997.  The decline in
total return was  primarily due to less  favorable  results in the common equity
portfolio,  which had a total return of 1.9 percent for the first nine months of
1998, compared with 28.5 percent for the same period of 1997.

Operating cash flow for the North American property/casualty  operations of $729
million  in the first  nine  months of 1998  increased  18.7  percent  from $614
million in the same period of 1997,  primarily due to lower paid losses.  Due to
the nature of General Re's reinsurance  operations,  paid claims may be volatile
from quarter to quarter.  In addition to operating cash flow, the North American
property/casualty  operations  had $298  million  of cash  outflows  related  to
contract deposits that matured during the first nine months of 1998 (included in
"change in contract  deposits" in the  statement of cash flows).  These types of
contracts generally have a provision that requires most of the investment income
earned on the funds  held by General  Re to be shared  with the ceding  company.
Thus,  the effect of the return of these funds was not  material  to  investment
income and earnings.

North  American  property/casualty  invested  assets  were  $16,052  million  at
September  30,  1998,  an increase of 0.4 percent from  December  31, 1997.  The
modest growth in invested assets was primarily the result of positive  operating
cash flow,  partially offset by the effect of share repurchases and common stock
dividends,  which are  funded  primarily  by this  segment.  The North  American
property/casualty  operations  realized $253 million of investment  gains during
the third quarter, of which $141 million was from sales of equity securities and
$59 million of net gains on S&P 500 put options.





                                                             14
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

The gross  liability  for  claims  and  claim  expenses  for the North  American
property/casualty  operations  was $10,547  million at  September  30,  1998,  a
decrease  of  $137  million,  or 1.3  percent,  compared  to the  year-end  1997
liability.


INTERNATIONAL PROPERTY / CASUALTY
(in millions)                          Third Quarter           Year-to-date
                                      ---------------         ---------------
                                      1998       1997         1998       1997
                                      ----       ----         ----       ----

Income before income taxes and
 realized gains                        $88        $86         $261       $235
Net premiums written                   403        496        1,605      1,787
Net underwriting (loss)               (11)        (9)         (29)       (40)

Loss ratio                            70.4%     70.2%        69.0%      72.3%
Expense ratio                         31.7      31.3         32.8       30.0
                                     -----     -----        -----      -----
Underwriting combined ratio          102.1%    101.5%       101.8%     102.3%

Investment income                      $93        $95         $270       $278
Other income (loss)                      5         -            19        (3)
Operating cash flow                     37        61           325       389

Results of the  international  reinsurance  operations are reported on a quarter
lag.

Income   before   income   taxes  and  realized   gains  of  the   international
property/casualty  operations  increased  2.0 percent  for the third  quarter of
1998,  compared  with the  third  quarter  of 1997 and  increased  11.0  percent
compared with the first nine months of 1997.  For the first nine months of 1998,
income  for the  international  property/casualty  operations  increased  due to
improved  underwriting  results and higher other income. The comparisons for the
third quarter and year-to-date 1998 were adversely affected by the strengthening
of the U.S. dollar (4.3 percent and 9.0 percent,  respectively)  relative to the
German mark.

The  underwriting   combined  ratio  in  the   international   property/casualty
operations was 102.1 percent in the third quarter, compared to 101.5 percent for
the third quarter of 1997 and 102.4 percent reported for the full year 1997. For
the first nine months of 1998 and 1997, the combined ratio was 101.8 percent and
102.3  percent,  respectively.  The  third  quarter  underwriting  results  were
adversely affected by a few large property losses.

International  net premiums  written  were $403 million in the third  quarter of
1998 and $1,605  million for the first nine months of 1998,  compared  with $496
million and $1,787 million,  respectively,  in 1997. Adjusted for the effects of
foreign  exchange,  international  property/casualty  premiums written decreased
14.7 percent and 2.7 percent in the third quarter and first nine months of 1998,
respectively.  The decline in premium  growth for the quarter was due in part to
increased retentions by cedants and the continuing effects from competitive rate
conditions in most insurance and reinsurance markets globally.






                                                             15
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

Pretax investment income for the international  property/casualty operations was
$93 million for the third quarter of 1998, compared with $95 million in the same
period of 1997. The decline in investment  income was due to a decline in global
interest rates and the effect of foreign  exchange.  Adjusted for the effects of
foreign exchange, pretax investment income increased 2.1 percent and 4.0 percent
for the third quarter and year-to-date. The international  property/casualty and
global  life/health  operations had cash flow from operating  activities of $325
million for the first nine months of 1998,  compared  with $389 million in 1997.
The decline in operating cash flow was  principally due to the effect of foreign
exchange and lower  underwriting  cash flow. In addition to operating cash flow,
the international  property/casualty operations had net cash outflows related to
contract  deposits during the period of $173 million.  Similar to North American
deposit  transactions,  these types of contracts generally have a provision that
requires most of the investment income earned on the funds held by General Re to
be shared with the ceding company. Thus, the effect of the return of these funds
is not material to investment income and earnings.

International  property/casualty  and  life/health  invested  assets were $8,653
million at September  30,  1998,  compared  with $8,581  million at December 31,
1997.  The increase in invested  assets was due to investment of operating  cash
flows.  The gross  liability for claims and claim expenses was $5,122 million at
September 30, 1998, compared with $5,113 million at December 31, 1997.


GLOBAL LIFE / HEALTH
(in millions)
                                          Third Quarter         Year-to-date
                                          -------------         ------------
                                          1998     1997         1998    1997
Income before income taxes and
 realized gains                            $18      $19          $55     $62
Net premiums written
     Life reinsurance                      200      230          608     645
     Health reinsurance                    106       97          317     265
                                           ---     ----          ---     ---

Total life/health net premiums written     306      327          925     910
Net underwriting income (loss)               1        2           (2)     11
Investment income                           20       18           61      54
Other income (loss)                        (3)       (1)          (4)     (3)

Income  before  income  taxes  and  realized  gains for the  global  life/health
operations decreased 6.3 percent for the third quarter of 1998 and declined 12.5
percent for the first nine months of 1998.  The decline in operating  income for
the nine months was due to lower underwriting results,  principally in the group
health reinsurance sector.

Life  reinsurance  premiums  written were $199 million for the third  quarter of
1998,  compared  with $230 million in the third  quarter of 1997.  For the first
nine  months,  life  reinsurance  premiums  written  were $608  million and $645
million  in 1998 and 1997,  respectively.  Adjusted  for the  effects of foreign
exchange,  global life reinsurance premiums decreased approximately 10.4 percent
in the quarter and increased  1.0 percent  year-to-date.  Premium  trends in the
life reinsurance business were adversely affect by product mix changes in Europe
and the loss of one contract with  approximately  $28 million of annual  premium
due to merger and acquisition activity.



                                                             16
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

Investment income for the global life/health  operations was $20 million and $61
million  in the third  quarter  and  first  nine  months of 1998,  respectively,
compared  to $18 million and $54  million in 1997.  The  increase in  investment
income was due to invested cash flow from higher  premium  volume over the prior
twelve months.

The liability for policy benefits for life/health  contracts was $962 million at
September 30, 1998,  compared with $907 million at December 31, 1997.  The asset
for  reinsurance  recoverable on unpaid losses was $299 million at September 30,
1998,  compared to $271  million at December  31,  1997.  Cologne Re manages its
invested  assets and total assets on an aggregate  basis for the life/health and
property/casualty business and does not disaggregate its investments by segment.


FINANCIAL SERVICES
(in millions)
                                                   Third Quarter    Year-to-date
                                                   -------------    ------------
                                                   1998     1997    1998    1997
                                                   ----     ----    ----    ----

Income  before  income taxes and realized  gains    $24      $25     $93     $87
Total  revenues(excluding  realized  gains)          78       73     267     237
Investment  income                                   15        8      33      23
Other income                                          9       17      60      64

Financial services  operations include General Re's derivative
products, investment management, insurance brokerage and management, reinsurance
brokerage, and real estate management operations. In the third quarter and first
nine  months  of 1998,  financial  services  revenues  of $78  million  and $267
million,  respectively,  increased  7.4  percent and 12.7  percent  from the $73
million  and $237  million in the third  quarter  and first nine months of 1997,
respectively. The growth in 1998 revenues was principally attributable to growth
in GRFP's  global  equity  business and fixed income  business in North  America
during the first two quarters of 1998 which slowed  during the third quarter due
to the turbulence in international financial markets.

Invested  assets  held for  trading  purposes  in the first nine  months of 1998
increased  $625 million to $2,484  million at September  30, 1998.  The increase
primarily  relates  to the  hedging  activities  of GRFP and  growth  in  GRFP's
match-funded  business.  At September  30, 1998,  total assets of the  financial
service  operations  were  $13,269  million,  compared  with  $8,874  million at
December  31, 1997.  The amount and nature of the  financial  service  segment's
assets  and  liabilities  are  significantly  affected  by the  risk  management
strategies  utilized by GRFP to reduce its market risks. GRFP's market exposures
arising from  derivative  products are managed  through the purchase and sale of
government  securities,  futures and  forward  contracts,  or by  entering  into
offsetting  derivatives  transactions.  The purchase of  government  securities,
usually financed through  collateralized  repurchase agreements (securities sold
under agreements to repurchase),  and the sale of government  securities,  whose
proceeds are invested in reverse  repurchase  agreements  (securities  purchased
under agreements to resell),  are used to offset GRFP's market exposures.  While
the use of these instruments for risk management  purposes may cause significant
short-term  fluctuations  in GRFP's assets and  liabilities,  they do not have a
material effect on General Re's results from  operations or common  shareowners'
equity.






                                                             17
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

MARKET RISK

As a global reinsurance and financial services company, General Re is subject to
market  risk  arising  from the  potential  change in the  value of its  various
financial instruments.  These changes may be due to fluctuations in interest and
foreign  exchange rates,  credit spreads and equity prices.  The level of market
risk  is  influenced  by  many  factors,  such as  volatility,  correlation  and
liquidity.  Potential  gains or  losses  from  changes  in  market  rates can be
estimated through statistical models that project within a specified  confidence
level the "value at risk" based on historical  price and  volatility  movements.
General Re's 1997 Form 10-K  provides a more  detailed  discussion of the market
risks  affecting the  reinsurance  and financial  service  operations.  Based on
General Re's estimates as of September 30, 1998, no material change has occurred
in its value at risk in the  reinsurance  operations,  as  compared  to  amounts
disclosed in its 1997 Form 10-K.

General Re's financial service operations are subject to market risk principally
through GRFP. GRFP monitors its market risk on a daily basis across all swap and
option  products by  calculating  the effect on  operating  results of potential
changes in market variables over a one-week period,  based on historical  market
volatility, correlation data and informed judgment. This evaluation is performed
on an individual trading book basis, against limits set by individual book, to a
95 percent  probability  level.  GRFP sets  market  risk limits for each type of
risk, and for an aggregate  measure of risk,  based on a 99 percent  probability
that  movements in market rates will not affect the results from  operations  in
excess of the limit over a one week period.  Risk is measured primarily by Monte
Carlo  simulations to obtain the required  degree of confidence.  In addition to
daily and weekly  assessments  of value at risk,  GRFP performs  stress tests to
estimate its exposure to extreme movements in various market risk factors.

The table below shows the highest,  lowest and average value-at-risk amounts for
each  type of  market  risk to which  GRFP is  exposed.  Since  1992,  when GRFP
initiated these  calculations,  there has been no one-week period for which GRFP
experienced a gain or loss that exceeded its estimated market risk exposure.

                                          Value at Risk
                                           -------------   
                                    First Nine Months of 1998
                                    ------------------------- 
                     Interest         Foreign
(in millions)          Rate        Exchange Rate        Equity      All Risks
                       ----        -------------        ------      ---------

Highest                 $9            $4                    $8            $13
Lowest                   5             2                     2              6
Average                  7             3                     5              9

                                           Full Year 1997
                     -----------------------------------------------------------
                     Interest        Foreign
(in millions)          Rate       Exchange Rate          Equity     All Risks
                       ----       -------------          ------     ---------
Highest               $11            $6                     $5             $13
Lowest                  6             3                      0               7
Average                 9             4                      2              10



                                                             18

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

For the first nine months of 1998,  the largest  weekly pretax gain and loss due
to market  risk was $5  million  and $6  million,  respectively.  In 1997,  the
largest  weekly  pretax  gain and loss due to market risk was $5 million and the
largest  weekly  pretax loss due to market risk was $3 million for the full year
1997.  The average  effect of the change in market risk on income was neutral in
the first nine months of 1998 and for the full year 1997.

CREDIT RISK

Credit risk arises from the  possible  inability of  counterparties  to meet the
terms of their  contracts.  GRFP  evaluates and records a fair value  adjustment
against  trading  revenue to recognize  counterparty  credit exposure and future
costs associated with administering each contract.  The expected credit exposure
for each trade is  initially  established  on the trade  date and is  determined
through  the  use of a  proprietary  credit  exposure  model  that is  based  on
historical default  probabilities,  market volatilities and, if applicable,  the
legal right of setoff. These exposures are continuously monitored,  and the fair
value adjustment is adjusted to reflect the changes in the credit quality of the
counterparty, changes in interest and currency rates or changes in other factors
affecting  credit  exposures.  GRFP has not  experienced  any write-offs on such
contracts.  In the event  counterparties are unable to fulfill their contractual
obligations,  future  losses  due  to  defaults  may  exceed  amounts  currently
recognized in the balance sheet.



YEAR 2000

General Re began to address its Year 2000 remediation  needs formally as part of
its annual  technology  planning  process  beginning in 1994. A project team was
established  that year,  and a  comprehensive  Year 2000 plan was  completed  in
September  1996.  This plan  required  a  complete  assessment  of the  internal
mainframe, server and personal computer hardware and software applications which
may be affected by the Year 2000.  In  addition,  inventories  were  produced of
internally  developed systems and programs,  telecommunications  equipment,  and
licensed  software  products used by General Re. Where business needs  justified
the effort,  some information systems needed to be replaced with entirely new
applications.  Other systems and programs are being repaired,  as necessary,  to
achieve Year 2000 compliance.

As  of  September   30,  1998,   coding  for  those  systems  under  repair  was
approximately  95 percent  complete,  and testing was  approximately  90 percent
complete. The inventory and assessment phases of the project had been previously
completed.  As of September 30, 1998, none of the General Re's other significant
information technology projects had been delayed due to Year 2000 initiatives.

In addition to  internally  developed  applications,  the Year 2000  project has
several other elements. A portion of the software used by General Re is licensed
from  outside  vendors.  For  example,  vendor  software  is found in certain of
General Re's  mainframe  operating  systems and desktop tools and packages.  The
project  team has been  working  with  software  vendors  to ensure  that  their
programs will continue to operate,  and this effort is scheduled to be completed
by the end of  1998.  Additionally,  the  inventory  of  computer  workstations,
servers and other computing  equipment is being reviewed,  and hardware is being
replaced or repaired, as appropriate.





                                                             19
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

As part of the Year 2000  project,  vendors and service  providers  of equipment
with embedded  technology (e.g.  elevators,  security  systems,  etc.) are being
contacted to obtain the necessary compliance certifications. A similar effort is
underway for financial  service  providers and vendors  supporting  General Re's
employee  benefits  plans.  Where  necessary,  facilities-related  equipment and
control systems are being upgraded to achieve  compliance,  and these activities
are also targeted for completion by the end of 1998.

General Re's Year 2000 project is proceeding on schedule,  and it is anticipated
that all Year 2000 repair or  replacement  work will be  completed by the end of
1998;  however,  General Re's financial  results or financial  position could be
adversely  affected  if Year 2000  issues are not  resolved by General Re or its
significant clients, vendors or business partners before the Year 2000. Possible
adverse consequences include but are not limited to: (1) the inability to obtain
services used in General Re's operations; (2) the inability to transact business
with key clients or customers; (3) the inability to execute transactions through
the financial  markets;  (4) the decline in economic  value within  General Re's
investment  portfolio,  and (5) the occurrence of Year 2000 related losses under
property and  casualty  insurance  and  reinsurance  contracts.  On a worst case
basis, if General Re, one or more of its significant  business partners,  or key
governmental  bodies are unable to implement  timely and effective  solutions to
the Year 2000 issues,  General Re could suffer  material  adverse  effects.  The
financial impact of such effects cannot currently be estimated.

Contingency Plan

General Re's overall Year 2000 project plan was developed  with the intention of
minimizing  the need for  contingency  activity.  Despite the best  planning and
execution  efforts,  however,  General Re is preparing for the possibility  that
some issues with the Year 2000 may not be uncovered. Accordingly, General Re has
developed several levels of contingency planning.

The target  completion  date of December 31, 1998 provides a  contingency  year.
With repaired  systems in production,  and  infrastructure  and process  changes
tested and  implemented,  General Re expects to uncover any remaining  system or
process issues during 1999. The year also affords the opportunity for additional
testing of systems,  as  appropriate.  Should some  portions of the project take
longer than  planned,  the  contingency  year also  provides a period of time to
address those issues.

As a further  step,  contingency  planning  for  General  Re's  dependencies  on
external  service  providers and suppliers has just begun and is scheduled to be
completed in 1999.  Finally,  plans call for the deployment of Year 2000 support
teams before,  during and after January 1, 2000, to respond to unexpected issues
that may arise.

Costs

The total  cost  associated  with  required  modifications  to become  Year 2000
compliant is approximately $20 million. The total amount expended on the Project
through the end of 1997 was  approximately $7 million.  The cost to complete the
Year 2000 Project is estimated to be  approximately  $13 million.  Funds for the
project are included in existing  operating  budgets.  The costs of implementing
any business replacement systems are not included in these estimates.



                                                             20
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

Insurance/Reinsurance Risk

In addition to its own computer systems and third party  relationships,  General
Re may also have exposure in its property/casualty operations to claims asserted
under certain reinsurance contracts and insurance policies for damages caused by
companies' failure to address Year 2000 computer  problems.  General Re has made
significant  investments in understanding and evaluating the potential insurance
exposures  arising from Year 2000 problems.  A  quantification  of the insurance
industry's  or General  Re's  potential  exposure to Year 2000 losses is not yet
possible, as policy wordings vary and legal interpretations of possible coverage
for losses is likely to differ from jurisdiction to jurisdiction.

THE EURO

On January 1, 1999, eleven of the fifteen member countries of the European Union
are  scheduled  to  establish  a fixed  conversion  ratio  between  their  local
currencies and a newly formed currency,  the "Euro". The Euro will begin trading
on foreign  currency  exchanges and may be used for business  transactions  from
that point forward. During this interim phase, either the Euro or local currency
may be used as legal tender for noncash transactions. Beginning in January 2002,
coins  and  paper  currency  denominated  in  Euros  will be  issued  and  local
currencies of the eleven countries will be withdrawn from  circulation.  General
Re is modifying its computer systems to accommodate  transactions denominated in
the Euro.  Most of General  Re's  existing  systems that will be affected by the
introduction  of the Euro already handle multiple  currencies.  Based on current
assessments,  General Re believes the Euro  conversion  will not have a material
impact on its consolidated financial position or results from operations.

SAFE HARBOR DISCLOSURE

In  connection  with the "safe  harbor"  provisions  of the  Private  Securities
Litigation  Reform  Act of  1995  (the  "Act"),  General  Re  sets  forth  below
cautionary  statements  identifying important risks and uncertainties that could
cause  its  actual  results  to  differ  materially  from  those  that  might be
projected, forecasted or estimated in its forward-looking statements, as defined
in the Act,  made by or on  behalf  of  General  Re in press  releases,  written
statements or documents filed with the Securities and Exchange Commission, or in
its  communications  and  discussions  with investors and analysts in the normal
course of business  through  meetings,  phone calls and conference  calls.  Such
statements may include,  but are not limited to, projections of premium revenue,
investment income, other revenue, losses, expenses, earnings (including earnings
per share), cash flows, plans for future operations,  common shareowners' equity
(including book value per share),  investments,  financing needs, capital plans,
dividends,  plans  relating to products or services of General Re and  estimates
concerning the effects of litigation or other  disputes,  as well as assumptions
for  any of the  foregoing  and  are  generally  expressed  with  words  such as
"believes,"   "estimates,"   "expects,"   "anticipates,"   "plans,"  "projects,"
"forecasts," "goals," "could have," "may have" and similar expressions.  General
Re, as a matter of policy,  does not make any specific  projections as to future
earnings nor does it endorse any projections  regarding future  performance that
may be made by others.






                                                             21
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

Forward-looking  statements  involve known and unknown risks and  uncertainties,
which  may  cause   General  Re's  results  to  differ   materially   from  such
forward-looking  statements.  These risks and uncertainties include, but are not
limited to, the following:

1)    Changes  in  the  level  of   competition   in  the  North   American  and
      international  reinsurance  or primary  insurance  markets that affect the
      volume or profitability of General Re's  property/casualty  or life/health
      businesses.  These changes include, but are not limited to, changes in the
      intensity of price  competition,  the entry of new  competitors,  existing
      competitors exiting the market, and the development of new products by new
      and existing competitors;

2)    Changes  in the  demand  for  reinsurance,  including  changes  in  ceding
      companies'  risk  retentions,  and  changes  in the  demand for excess and
      surplus lines  insurance  coverages in North  America,  and changes in the
      demand for financial service operations' products.

3)    The ability of General Re to execute  its  strategies  in its
      property/casualty,  life/health  and  financial  service operations;

4)    Catastrophe   losses  in  General  Re's  North  American  or international
      property/casualty businesses;

5)    Adverse   development  on   property/casualty   claim  and  claim  expense
      liabilities related to business written in prior years, including, but not
      limited to,  evolving case law and its effect on  environmental  and other
      latent injury claims,  changing government  regulations,  newly identified
      toxins, newly reported claims, new theories of liability, such as possible
      Year  2000  computer-related  losses,  or new  insurance  and  reinsurance
      contract interpretations;

6)    Changes in inflation that affect the profitability of General Re's current
      property/casualty  and  life/health  businesses  or  the  adequacy  of its
      property/casualty  claim and claim  expense  liabilities  and  life/health
      policy benefit liabilities related to prior years' business;

7)     Changes in General Re's property/casualty and life/health retrocessional
       arrangements;

8)    Lower than estimated  retrocessional  or reinsurance  recoveries on unpaid
      losses,  including,  but not  limited  to,  losses due to a decline in the
      creditworthiness of General Re's retrocessionaires or reinsurers;

9)    Increases in interest  rates,  which cause a reduction in the market value
      of  General  Re's  fixed  income  investment  portfolio,  and  its  common
      shareowners' equity;

10)   Decreases in interest  rates  causing a reduction of income  earned on new
      cash flow from operations and the reinvestment of the proceeds from sales,
      calls or maturities of existing investments;

11) Decline in the value of General Re's common equity investments;






                                                             22
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF

            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)


12)  Changes in the composition of General Re's investment portfolio;

13)  Changes  in  mortality  or  morbidity   levels  that  affect  General  Re's
     life/health business;

14)   Credit  losses on General  Re's  investment  portfolio;  credit and market
      losses on GRFP's portfolio of derivatives and other transactions;

15)   Adverse  results in  litigation  matters,  including,  but not limited to,
      litigation  related to  environmental,  asbestos and other  potential mass
      tort claims;

16)  Gains or losses related to changes in foreign currency exchange rates;

17)   The potential  interruption  in, or a failure of,  certain normal business
      activities or operations due to Year 2000
      related  computer problems, and

18) Changes in General Re's capital needs.

In addition to the factors  outlined above that are directly  related to General
Re's  businesses,  General  Re  is  also  subject  to  general  business  risks,
including, but not limited to, adverse state, federal or foreign legislation and
regulation,  adverse  publicity or news  coverage,  changes in general  economic
factors and the loss of key employees.

























                                                             23
                                OTHER INFORMATION


Item 4. Submission of Matters to a Vote of Security Holders

A Special  Meeting of the  Stockholders  of General Re was held on September 18,
1998.  During the meeting,  the stockholders  approved the Agreement and Plan of
Mergers  between  General Re and Berkshire  Hathaway  Inc. and the  transactions
contemplated therein.


Item 6. Exhibits and Reports on Form 8-K

(a)    Reports on Form 8-K          -   None

(b)    Exhibit 27.1                 -   Financial Data Schedule for the Period
                                        Ended September 30, 1998


































                                                             24


<PAGE>



                                   SIGNATURES


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


                               GENERAL RE CORPORATION
                               ----------------------   
                                     (Registrant)

Date:    November 16, 1998     JOSEPH P. BRANDON
                               Joseph P. Brandon
                               Senior Vice President and Chief Financial Officer
                               (Principal Financial Officer)

Date:    November 16, 1998     ELIZABETH A. MONRAD
                               Elizabeth A. Monrad
                               Vice President and Treasurer
                               (Principal Accounting Officer)