##### 



As filed with the Securities and Exchange Commission on
March 7, 2005








SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549





Form 10-K


ANNUAL REPORT UNDER SECTION 13 OR 15(d)


OF THE SECURITIES EXCHANGE ACT OF 1934


For the fiscal year ended: December 31, 2004


Commission File Number: 1-16535





Odyssey Re Holdings Corp.


(Exact Name of Registrant as Specified in its Charter)


|                                                                    |  |                                            
|------------------------------------------------------------------- |  | -------------------------------------------
|Delaware                                                            |  | 52-2301683                                 
|(State or Other Jurisdiction of
     Incorporation or Organization) |  | (I.R.S. Employer
    Identification Number)




Odyssey Re Holdings Corp.


300 First Stamford Place, Stamford, Connecticut 06902


(203) 977-8000


(Address, including zip code, and telephone number,


including area code, of registrants principal executive
offices)





Donald L. Smith, Esq.


Senior Vice President, General Counsel and Corporate
Secretary


Odyssey Re Holdings Corp.


300 First Stamford Place, Stamford, Connecticut 06902


(203) 977-8000


(Name, address, including zip code, and telephone number,
including area code, of agent for service)


Securities registered pursuant to Section 12(b) of the
Act:


|                                        |  |                                          
|--------------------------------------- |  | -----------------------------------------
|Title of Each Class                     |  | Name of Each Exchange On Which Registered
|                                        |  |                                          
|Common Stock, par value $0.01 per share |  | New York Stock Exchange                  

Securities Registered Pursuant to Section 12(g) of the
Act:


None


þ o


o


þ o






Documents Incorporated by Reference













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ODYSSEY RE HOLDINGS CORP.


TABLE OF CONTENTS


|         |  |                                                                                                                  |  |      |     | 
|-------- |  | ---------------------------------------------------------------------------------------------------------------- |  | ---- | --- | 
|         |  |                                                                                                                  |  | Page |    
|         |  |                                                                                                                  |  |      |    
|PART I  
|Item 1.  |  | Business                                                                                                         |  |      | 5   | 
|Item 2.  |  | Properties                                                                                                       |  |      | 37  | 
|Item 3.  |  | Legal Proceedings                                                                                                |  |      | 37  | 
|Item 4.  |  | Submission of Matters to a Vote of Security Holders                                                              |  |      | 37  | 
|        
|PART II 
|Item 5.  |  | Market for Registrants Common Equity, Related Stockholder
    Matters and Issuer Purchases of Equity Securities |  |      | 38  | 
|Item 6.  |  | Selected Financial Data                                                                                          |  |      | 39  | 
|Item 7.  |  | Managements Discussion and Analysis of Financial Condition
    and Results of Operations                        |  |      | 42  | 
|Item 7A. |  | Quantitative and Qualitative Disclosures About Market Risk                                                       |  |      | 61  | 
|Item 8.  |  | Financial Statements and Supplementary Data                                                                      |  |      | 62  | 
|Item 9.  |  | Changes in and Disagreements with Accountants on Accounting and
    Financial Disclosures                        |  |      | 119 | 
|Item 9A. |  | Controls and Procedures                                                                                          |  |      | 119 | 
|Item 9B. |  | Other Information                                                                                                |  |      | 119 | 
|        
|PART III
|Item 10. |  | Directors and Executive Officers of the Registrant                                                               |  |      | 119 | 
|Item 11. |  | Executive Compensation                                                                                           |  |      | 120 | 
|Item 12. |  | Security Ownership of Certain Beneficial Owners and Management
    and Related Stockholder Matters               |  |      | 120 | 
|Item 13. |  | Certain Relationships and Related Transactions                                                                   |  |      | 120 | 
|Item 14. |  | Principal Accountant Fees and Services                                                                           |  |      | 120 | 
|Item 15. |  | Exhibits and Financial Statement Schedules                                                                       |  |      | 120 | 



2



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SAFE HARBOR DISCLOSURE








| |   |                                                                                                                                                                                                                                                                                                     
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the occurrence of catastrophic events with a frequency or
    severity exceeding our estimates;                                                                                                                                                                                                     
|
| |  | a decrease in the level of demand for our reinsurance or
    insurance business, or increased competition in the industry;                                                                                                                                                                          
|
| |  | the lowering or loss of one of our financial or claims-paying
    ratings, including those of our subsidiaries;                                                                                                                                                                                     
|
| |  | a change in the trading requirements of one or more of our
    current or potential customers, including but not limited to,
    their minimum required financial or claims paying ratings, or
    their counterparty collateral requirements, such that the demand
    for our products is reduced;
|
| |  | risks associated with implementing and executing our business
    strategies;                                                                                                                                                                                                                       
|
| |  | uncertainties in our reserving process;                                                                                                                                                                                                                                                             
|
| |  | emerging claim and coverage issues, which could expand our
    obligations beyond the amount we intend to underwrite;                                                                                                                                                                               
|
| |  | failure of our reinsurers to honor their obligations;                                                                                                                                                                                                                                               
|
| |  | risks associated with the growth of our primary and specialty
    insurance business, and the development of our infrastructure to
    support this growth;                                                                                                                                         
|
| |  | risks relating to our strategy of relying on program managers,
    third party administrators, and other vendors to support our
    direct insurance operations;                                                                                                                                    
|
| |  | other risks of doing business with program managers, including
    the risk we might be bound to policyholder obligations beyond
    our underwriting intent, and the risk that our program managers
    or agents may elect not to continue or renew their programs with
    us;                   
|
| |  | actions of our competitors, including industry consolidation,
    and increased competition from alternative sources of risk
    management products, such as the capital markets;                                                                                                                  
|
| |  | loss of services of any of our key employees;                                                                                                                                                                                                                                                       
|
| |  | the passage of federal or state legislation subjecting our
    business to additional supervision or regulation, including
    additional tax regulation, in the United States or other
    jurisdictions in which we operate;                                                                      
|
| |  | the risk that ongoing regulatory developments will disrupt our
    business, or that of our business partners, or mandate changes
    in industry practices in a fashion that increases our costs or
    requires us to alter aspects of the way we do business;                                    
|
| |  | changes in economic conditions, including interest rate,
    currency, equity and credit conditions which could affect our
    investment portfolio; and                                                                                                                                            
|
| |  | acts of war, terrorism or political unrest.                                                                                                                                                                                                                                                         

3



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4



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|        |         
|------- | --------
|Item 1. | Business

The Company












5



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##### 









The Reinsurance Business










6



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##### 

















7



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Lines of Business




|                         |                                  |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |   |       |         |  |  |      |       |  
|------------------------ | -------------------------------- | ------------------------ | ----- | ------- | ---- |  | ---- | ----- | - | - | ----- | ------- |  | - | ---- | ----- | - | - | ----- | ------- |  |  | ---- | ----- | -
|                         |                                  | Years Ended December 31, |      
|                         |                                  |                          |      
|                         |                                  | 2004                     |       |         | 2003 |  |      | 2002  |  
|                         |                                  |                          |       |         |      |  |      |       |  
|                         |                                  | $                        |       |         | %    |  |      | $     |   |   | %     |         |  | $ |      |       | % |  
|                         |                                  |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  
|                         |                                  | (Dollars in millions)    |      
|Treaty Reinsurance:      |                                  |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |   |       |         |  |  |      |      
|Property excess of loss  |                                  | $                        | 301.3 |         |      |  | 11.2 | %     |   | $ | 264.3 |         |  |   | 10.2 | %     |   | $ | 218.4 |         |  |  | 11.3 | %    
|Property proportional    |                                  |                          | 399.5 |         |      |  | 14.9 |       |   |   | 419.3 |         |  |   | 16.1 |       |   |   | 303.6 |         |  |  | 15.7 |      
|Casualty excess of loss  |                                  |                          | 293.6 |         |      |  | 11.0 |       |   |   | 304.3 |         |  |   | 11.7 |       |   |   | 269.0 |         |  |  | 13.9 |      
|Casualty proportional    |                                  |                          | 557.2 |         |      |  | 20.8 |       |   |   | 615.8 |         |  |   | 23.6 |       |   |   | 492.2 |         |  |  | 25.5 |      
|Marine and aerospace     |                                  |                          | 138.3 |         |      |  | 5.2  |       |   |   | 108.2 |         |  |   | 4.2  |       |   |   | 72.5  |         |  |  | 3.8  |      
|Surety and credit        |                                  |                          | 106.3 |         |      |  | 4.0  |       |   |   | 85.8  |         |  |   | 3.3  |       |   |   | 40.4  |         |  |  | 2.1  |      
|Miscellaneous            |                                  |                          | 12.2  |         |      |  | 0.5  |       |   |   | 15.0  |         |  |   | 0.6  |       |   |   | 28.7  |         |  |  | 1.5  |      
|                         |                                  |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  
|                         | Treaty reinsurance               |                          |       | 1,808.4 |      |  |      | 67.6  |   |   |       | 1,812.7 |  |   |      | 69.7  |   |   |       | 1,424.8 |  |  |      | 73.8  |  
|                         |                                  |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  
|Facultative Reinsurance: |                                  |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |   |       |         |  |  |      |      
|Property                 |                                  |                          | 65.0  |         |      |  | 2.4  |       |   |   | 74.8  |         |  |   | 2.9  |       |   |   | 70.7  |         |  |  | 3.7  |      
|Casualty                 |                                  |                          | 101.0 |         |      |  | 3.8  |       |   |   | 78.8  |         |  |   | 3.0  |       |   |   | 66.4  |         |  |  | 3.4  |      
|                         |                                  |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  
|                         | Facultative reinsurance          |                          |       | 166.0   |      |  |      | 6.2   |   |   |       | 153.6   |  |   |      | 5.9   |   |   |       | 137.1   |  |  |      | 7.1   |  
|                         |                                  |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  
|U.S. Insurance           |                                  |                          | 412.1 |         |      |  | 15.4 |       |   |   | 333.8 |         |  |   | 12.8 |       |   |   | 168.6 |         |  |  | 8.7  |      
|Newline                  |                                  |                          | 265.2 |         |      |  | 9.9  |       |   |   | 283.5 |         |  |   | 10.9 |       |   |   | 197.8 |         |  |  | 10.2 |      
|First Capital            |                                  |                          | 24.9  |         |      |  | 0.9  |       |   |   | 17.6  |         |  |   | 0.7  |       |   |   | 3.2   |         |  |  | 0.2  |      
|                         |                                  |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  
|                         | Total gross premiums written (1) |                          | $     | 2,676.6 |      |  |      | 100.0 | % |   | $     | 2,601.2 |  |   |      | 100.0 | % |   | $     | 1,931.5 |  |  |      | 100.0 | %
|                         |                                  |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | A portion of the gross premiums written by the
    U.S. Insurance division has been ceded to, and is also
    included in, the Americas divisions gross premiums
    written. Accordingly, the total gross premiums written as shown
    in the table above do not agree to the gross premiums written of
    $2,656.5 million, $2,558.2 million and $1,894.5
    million for the years ended December 31, 2004, 2003 and
    2002, respectively, reflected in the consolidated statements of
    operations.





8



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##### 















Divisions




|               |                                 |                          |         |         |      |  |      |       |   |   |         |         |  |   |      |       |   |   |         |         |  |  |      |       |  
|-------------- | ------------------------------- | ------------------------ | ------- | ------- | ---- |  | ---- | ----- | - | - | ------- | ------- |  | - | ---- | ----- | - | - | ------- | ------- |  |  | ---- | ----- | -
|               |                                 | Years Ended December 31, |        
|               |                                 |                          |        
|               |                                 | 2004                     |         |         | 2003 |  |      | 2002  |  
|               |                                 |                          |         |         |      |  |      |       |  
|               |                                 | $                        |         |         | %    |  |      | $     |   |   | %       |         |  | $ |      |       | % |  
|               |                                 |                          |         |         |      |  |      |       |   |   |         |         |  |   |      |       |   |  
|               |                                 | (Dollars in millions)    |        
|Americas       |                                 | $                        | 1,263.2 |         |      |  | 47.2 | %     |   | $ | 1,421.4 |         |  |   | 54.7 | %     |   | $ | 1,189.0 |         |  |  | 61.6 | %    
|EuroAsia       |                                 |                          | 553.6   |         |      |  | 20.7 |       |   |   | 408.1   |         |  |   | 15.7 |       |   |   | 258.6   |         |  |  | 13.4 |      
|London Market  |                                 |                          | 447.7   |         |      |  | 16.7 |       |   |   | 437.9   |         |  |   | 16.8 |       |   |   | 315.3   |         |  |  | 16.3 |      
|U.S. Insurance |                                 |                          | 412.1   |         |      |  | 15.4 |       |   |   | 333.8   |         |  |   | 12.8 |       |   |   | 168.6   |         |  |  | 8.7  |      
|               |                                 |                          |         |         |      |  |      |       |   |   |         |         |  |   |      |       |   |  
|               | Total gross premiums written(1) |                          | $       | 2,676.6 |      |  |      | 100.0 | % |   | $       | 2,601.2 |  |   |      | 100.0 | % |   | $       | 1,931.5 |  |  |      | 100.0 | %
|               |                                 |                          |         |         |      |  |      |       |   |   |         |         |  |   |      |       |   |  

9



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##### 










|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | A portion of the gross premiums written by the
    U.S. Insurance division has been ceded to, and is also
    included in, the Americas divisions gross premiums
    written. Accordingly, the total gross premiums written as shown
    in the table above do not agree to the gross premiums written of
    $2,656.5 million, $2,558.2 million and
    $1,894.5 million for the years ended December 31,
    2004, 2003 and 2002, respectively, reflected in the consolidated
    statements of operations.



| |                  
| | -----------------
| | Americas Division







|                 |                              |                          |         |         |      |  |      |       |   |   |         |         |  |   |      |       |   |   |         |         |  |  |      |       |  
|---------------- | ---------------------------- | ------------------------ | ------- | ------- | ---- |  | ---- | ----- | - | - | ------- | ------- |  | - | ---- | ----- | - | - | ------- | ------- |  |  | ---- | ----- | -
|                 |                              | Years Ended December 31, |        
|                 |                              |                          |        
|                 |                              | 2004                     |         |         | 2003 |  |      | 2002  |  
|                 |                              |                          |         |         |      |  |      |       |  
|                 |                              | $                        |         |         | %    |  |      | $     |   |   | %       |         |  | $ |      |       | % |  
|                 |                              |                          |         |         |      |  |      |       |   |   |         |         |  |   |      |       |   |  
|                 |                              | (Dollars in millions)    |        
|United States    |                              | $                        | 1,044.4 |         |      |  | 82.7 | %     |   | $ | 1,188.0 |         |  |   | 83.6 | %     |   | $ | 1,024.2 |         |  |  | 86.2 | %    
|Latin America    |                              |                          | 171.3   |         |      |  | 13.6 |       |   |   | 149.7   |         |  |   | 10.5 |       |   |   | 116.8   |         |  |  | 9.8  |      
|Canada           |                              |                          | 46.0    |         |      |  | 3.6  |       |   |   | 79.6    |         |  |   | 5.6  |       |   |   | 40.8    |         |  |  | 3.4  |      
|                 |                              |                          |         |         |      |  |      |       |   |   |         |         |  |   |      |       |   |  
|                 | Subtotal                     |                          |         | 1,261.7 |      |  |      | 99.9  |   |   |         | 1,417.3 |  |   |      | 99.7  |   |   |         | 1,181.8 |  |  |      | 99.4  |  
|London Branch(1) |                              |                          | 1.5     |         |      |  | 0.1  |       |   |   | 4.1     |         |  |   | 0.3  |       |   |   | 7.2     |         |  |  | 0.6  |      
|                 |                              |                          |         |         |      |  |      |       |   |   |         |         |  |   |      |       |   |  
|                 | Total gross premiums written |                          | $       | 1,263.2 |      |  |      | 100.0 | % |   | $       | 1,421.4 |  |   |      | 100.0 | % |   | $       | 1,189.0 |  |  |      | 100.0 | %
|                 |                              |                          |         |         |      |  |      |       |   |   |         |         |  |   |      |       |   |  






|    |                                                                                                                                                                                                                                        
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | As part of the realignment of our business across geographic
    regions, gross premiums previously written by the London branch
    unit are included in the London Market division for business
    incepting in 2001 and subsequent.



10



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##### 





|                         |                               |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |   |       |         |  |  |      |       |  
|------------------------ | ----------------------------- | ------------------------ | ----- | ------- | ---- |  | ---- | ----- | - | - | ----- | ------- |  | - | ---- | ----- | - | - | ----- | ------- |  |  | ---- | ----- | -
|                         |                               | Years Ended December 31, |      
|                         |                               |                          |      
|                         |                               | 2004                     |       |         | 2003 |  |      | 2002  |  
|                         |                               |                          |       |         |      |  |      |       |  
|                         |                               | $                        |       |         | %    |  |      | $     |   |   | %     |         |  | $ |      |       | % |  
|                         |                               |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  
|                         |                               | (Dollars in millions)    |      
|Treaty Reinsurance:      |                               |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |   |       |         |  |  |      |      
|Property excess of loss  |                               | $                        | 108.4 |         |      |  | 8.6  | %     |   | $ | 117.0 |         |  |   | 8.2  | %     |   | $ | 114.8 |         |  |  | 9.7  | %    
|Property proportional    |                               |                          | 201.0 |         |      |  | 15.9 |       |   |   | 254.5 |         |  |   | 17.9 |       |   |   | 189.6 |         |  |  | 15.9 |      
|Casualty excess of loss  |                               |                          | 219.0 |         |      |  | 17.3 |       |   |   | 249.9 |         |  |   | 17.6 |       |   |   | 241.2 |         |  |  | 20.3 |      
|Casualty proportional    |                               |                          | 479.7 |         |      |  | 38.0 |       |   |   | 573.9 |         |  |   | 40.4 |       |   |   | 460.6 |         |  |  | 38.7 |      
|Marine and aerospace     |                               |                          | 33.6  |         |      |  | 2.6  |       |   |   | 20.7  |         |  |   | 1.4  |       |   |   | 13.0  |         |  |  | 1.1  |      
|Surety and credit        |                               |                          | 47.8  |         |      |  | 3.8  |       |   |   | 45.4  |         |  |   | 3.2  |       |   |   | 28.7  |         |  |  | 2.4  |      
|Miscellaneous lines      |                               |                          | 12.2  |         |      |  | 1.0  |       |   |   | 15.0  |         |  |   | 1.1  |       |   |   | 28.6  |         |  |  | 2.4  |      
|                         |                               |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  
|                         | Total treaty reinsurance      |                          |       | 1,101.7 |      |  |      | 87.2  |   |   |       | 1,276.4 |  |   |      | 89.8  |   |   |       | 1,076.5 |  |  |      | 90.5  |  
|                         |                               |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  
|Facultative reinsurance: |                               |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |   |       |         |  |  |      |      
|Property                 |                               |                          | 60.5  |         |      |  | 4.8  |       |   |   | 66.2  |         |  |   | 4.7  |       |   |   | 46.1  |         |  |  | 3.9  |      
|Casualty                 |                               |                          | 101.0 |         |      |  | 8.0  |       |   |   | 78.8  |         |  |   | 5.5  |       |   |   | 66.4  |         |  |  | 5.6  |      
|                         |                               |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  
|                         | Total facultative reinsurance |                          |       | 161.5   |      |  |      | 12.8  |   |   |       | 145.0   |  |   |      | 10.2  |   |   |       | 112.5   |  |  |      | 9.5   |  
|                         |                               |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  
|                         | Total gross premiums written  |                          | $     | 1,263.2 |      |  |      | 100.0 | % |   | $     | 1,421.4 |  |   |      | 100.0 | % |   | $     | 1,189.0 |  |  |      | 100.0 | %
|                         |                               |                          |       |         |      |  |      |       |   |   |       |         |  |   |      |       |   |  



| |                  
| | -----------------
| | EuroAsia Division







11



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|                                 |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |   |       |       |  |  |      |       |  
|-------------------------------- | ---------------------------- | ------------------------ | ----- | ----- | ---- |  | ---- | ----- | - | - | ----- | ----- |  | - | ---- | ----- | - | - | ----- | ----- |  |  | ---- | ----- | -
|                                 |                              | Years Ended December 31, |      
|                                 |                              |                          |      
|                                 |                              | 2004                     |       |       | 2003 |  |      | 2002  |  
|                                 |                              |                          |       |       |      |  |      |       |  
|                                 |                              | $                        |       |       | %    |  |      | $     |   |   | %     |       |  | $ |      |       | % |  
|                                 |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  
|                                 |                              | (Dollars in millions)    |      
|Treaty Reinsurance:              |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |   |       |       |  |  |      |      
|Property excess of loss          |                              | $                        | 126.7 |       |      |  | 22.9 | %     |   | $ | 99.4  |       |  |   | 24.4 | %     |   | $ | 57.8  |       |  |  | 22.4 | %    
|Property proportional            |                              |                          | 191.6 |       |      |  | 34.6 |       |   |   | 150.2 |       |  |   | 36.8 |       |   |   | 102.8 |       |  |  | 39.8 |      
|Casualty excess of loss          |                              |                          | 51.6  |       |      |  | 9.3  |       |   |   | 35.1  |       |  |   | 8.6  |       |   |   | 17.9  |       |  |  | 6.9  |      
|Casualty proportional            |                              |                          | 54.0  |       |      |  | 9.8  |       |   |   | 26.9  |       |  |   | 6.6  |       |   |   | 24.6  |       |  |  | 9.5  |      
|Marine and aerospace             |                              |                          | 41.8  |       |      |  | 7.5  |       |   |   | 29.9  |       |  |   | 7.3  |       |   |   | 16.0  |       |  |  | 6.2  |      
|Surety and credit                |                              |                          | 58.5  |       |      |  | 10.6 |       |   |   | 40.4  |       |  |   | 9.9  |       |   |   | 11.7  |       |  |  | 4.5  |      
|                                 |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  
|                                 | Total treaty reinsurance     |                          |       | 524.2 |      |  |      | 94.7  |   |   |       | 381.9 |  |   |      | 93.6  |   |   |       | 230.8 |  |  |      | 89.3  |  
|Property facultative reinsurance |                              |                          | 4.5   |       |      |  | 0.8  |       |   |   | 8.6   |       |  |   | 2.1  |       |   |   | 24.6  |       |  |  | 9.5  |      
|First Capital                    |                              |                          | 24.9  |       |      |  | 4.5  |       |   |   | 17.6  |       |  |   | 4.3  |       |   |   | 3.2   |       |  |  | 1.2  |      
|                                 |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  
|                                 | Total gross premiums written |                          | $     | 553.6 |      |  |      | 100.0 | % |   | $     | 408.1 |  |   |      | 100.0 | % |   | $     | 258.6 |  |  |      | 100.0 | %
|                                 |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  



| |                       
| | ----------------------
| | London Market Division





|                        |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |   |       |       |  |  |      |       |  
|----------------------- | ---------------------------- | ------------------------ | ----- | ----- | ---- |  | ---- | ----- | - | - | ----- | ----- |  | - | ---- | ----- | - | - | ----- | ----- |  |  | ---- | ----- | -
|                        |                              | Years Ended December 31, |      
|                        |                              |                          |      
|                        |                              | 2004                     |       |       | 2003 |  |      | 2002  |  
|                        |                              |                          |       |       |      |  |      |       |  
|                        |                              | $                        |       |       | %    |  |      | $     |   |   | %     |       |  | $ |      |       | % |  
|                        |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  
|                        |                              | (Dollars in millions)    |      
|London Branch           |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |   |       |       |  |  |      |      
|Property excess of loss |                              | $                        | 66.2  |       |      |  | 14.8 | %     |   | $ | 48.0  |       |  |   | 11.0 | %     |   | $ | 45.9  |       |  |  | 14.6 | %    
|Property proportional   |                              |                          | 6.9   |       |      |  | 1.5  |       |   |   | 14.6  |       |  |   | 3.3  |       |   |   | 11.3  |       |  |  | 3.6  |      
|Casualty excess of loss |                              |                          | 22.9  |       |      |  | 5.1  |       |   |   | 19.3  |       |  |   | 4.4  |       |   |   | 9.9   |       |  |  | 3.1  |      
|Casualty proportional   |                              |                          | 23.5  |       |      |  | 5.3  |       |   |   | 15.0  |       |  |   | 3.4  |       |   |   | 6.9   |       |  |  | 2.2  |      
|Marine and aerospace    |                              |                          | 63.0  |       |      |  | 14.1 |       |   |   | 57.5  |       |  |   | 13.2 |       |   |   | 43.5  |       |  |  | 13.8 |      
|                        |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  
|                        | Total London Branch          |                          |       | 182.5 |      |  |      | 40.8  |   |   |       | 154.4 |  |   |      | 35.3  |   |   |       | 117.5 |  |  |      | 37.3  |  
|                        |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  
|Newline                 |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |   |       |       |  |  |      |      
|Liability lines         |                              |                          | 254.3 |       |      |  | 56.8 |       |   |   | 264.1 |       |  |   | 60.3 |       |   |   | 163.7 |       |  |  | 51.9 |      
|All other               |                              |                          | 10.9  |       |      |  | 2.4  |       |   |   | 19.4  |       |  |   | 4.4  |       |   |   | 34.1  |       |  |  | 10.8 |      
|                        |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  
|                        | Total Newline                |                          |       | 265.2 |      |  |      | 59.2  |   |   |       | 283.5 |  |   |      | 64.7  |   |   |       | 197.8 |  |  |      | 62.7  |  
|                        |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  
|                        | Total gross premiums written |                          | $     | 447.7 |      |  |      | 100.0 | % |   | $     | 437.9 |  |   |      | 100.0 | % |   | $     | 315.3 |  |  |      | 100.0 | %
|                        |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  

12



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##### 









| |                        
| | -----------------------
| | U.S. Insurance Division





|           |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |   |      |       |  |  |      |       |  
|---------- | ---------------------------- | ------------------------ | ----- | ----- | ---- |  | ---- | ----- | - | - | ----- | ----- |  | - | ---- | ----- | - | - | ---- | ----- |  |  | ---- | ----- | -
|           |                              | Years Ended December 31, |      
|           |                              |                          |      
|           |                              | 2004                     |       |       | 2003 |  |      | 2002  |  
|           |                              |                          |       |       |      |  |      |       |  
|           |                              | $                        |       |       | %    |  |      | $     |   |   | %     |       |  | $ |      |       | % |  
|           |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  
|           |                              | (Dollars in millions)    |      
|Healthcare |                              | $                        | 137.7 |       |      |  | 33.3 | %     |   | $ | 110.6 |       |  |   | 33.1 | %     |   | $ |     |       |  |  |     | %    
|Property   |                              |                          | 32.0  |       |      |  | 7.8  |       |   |   | 37.9  |       |  |   | 11.4 |       |   |   | 27.6 |       |  |  | 16.4 |      
|Casualty   |                              |                          | 134.2 |       |      |  | 32.6 |       |   |   | 97.2  |       |  |   | 29.1 |       |   |   | 73.7 |       |  |  | 43.7 |      
|Auto       |                              |                          | 108.2 |       |      |  | 26.3 |       |   |   | 88.1  |       |  |   | 26.4 |       |   |   | 67.3 |       |  |  | 39.9 |      
|           |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  
|           | Total gross premiums written |                          | $     | 412.1 |      |  |      | 100.0 | % |   | $     | 333.8 |  |   |      | 100.0 | % |   | $    | 168.6 |  |  |      | 100.0 | %
|           |                              |                          |       |       |      |  |      |       |   |   |       |       |  |   |      |       |   |  

Retention Levels and Retrocession Arrangements




13



---



##### 





|            |              |                       |   |         |               |  |  |             |  |  |   |      | 
|----------- | ------------ | --------------------- | - | ------- | ------------- |  |  | ----------- |  |  | - | ---- | 
|            |              |                       |   | Maximum |               |  | 
|            |              | Gross                 |   |         | Retrocession/ |  |  | Maximum Net | 
|            |              | Capacity              |   |         | Reinsurance   |  |  | Retention   | 
|            |              |                       |   |         |               |  |  |             | 
|            |              | (Dollars in millions) |  
|Treaty      |              |                       |   |         |               |  |  |             |  |  |   |     
|            | Property     |                       | $ | 10.0    |               |  |  |             |  |  | $ | 10.0 | 
|            | Casualty     |                       |   | 7.5     |               |  |  |             |  |  |   | 7.5  | 
|Facultative |              |                       |   |         |               |  |  |             |  |  |   |     
|            | Property     |                       |   | 10.0    |               |  |  | 9.0         |  |  |   | 1.5  | 
|            | Casualty     |                       |   | 5.0     |               |  |  | 1.2         |  |  |   | 3.8  | 
|Insurance   |              |                       |   |         |               |  |  |             |  |  |   |     
|            | U.S. Program |                       |   | 10.0    |               |  |  | 9.4         |  |  |   | 3.8  | 
|            | Healthcare   |                       |   | 11.0    |               |  |  | 10.1        |  |  |   | 2.5  | 
|            | Newline      |                       |   | 19.0    |               |  |  | 11.9        |  |  |   | 7.0  | 



Marketing












14



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##### 



Claims




Reserves for Unpaid Losses and Loss Adjustment Expenses












15



---



##### 















16



---



##### 













17



---



##### 









18



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##### 



Ten Year Analysis of Consolidated Losses and Loss Adjustment
Expense Reserve Development Table


Presented Net of Reinsurance With Supplemental Gross Data


|                                                  |                                    |                       |       |       |      |   |       |       |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|------------------------------------------------- | ---------------------------------- | --------------------- | ----- | ----- | ---- | - | ----- | ----- |  | - | ----- | ----- | - | ---- | ----- | ----- | ---- | - | ----- | ----- | - | - | ----- | ----- | - | ---- | ----- | ----- | ---- | - | ----- | ----- | - | - | ----- | ----- | - | - | ----- | ----- | - | - | ----- |  | 
|                                                  |                                    | 1994                  |       |       | 1995 |   |       | 1996  |  |   | 1997  |       |   | 1998 |       |       | 1999 |   |       | 2000  |   |   | 2001  |       |   | 2002 |       |       | 2003 |   |       | 2004  |  
|                                                  |                                    |                       |       |       |      |   |       |       |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |  
|                                                  |                                    | (Dollars in millions) |      
|Reserves for unpaid losses and LAE                |                                    | $                     | 1,906 |       |      | $ | 1,987 |       |  | $ | 1,992 |       |   | $    | 2,134 |       |      | $ | 1,988 |       |   | $ | 1,831 |       |   | $    | 1,667 |       |      | $ | 1,674 |       |   | $ | 1,845 |       |   | $ | 2,342 |       |   | $ | 3,136 | 
|Paid (cumulative) as of:                          |                                    |                       |       |       |      |   |       |       |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       | 
|                                                  | One year later                     |                       |       | 367   |      |   |       | 476   |  |   |       | 457   |   |      |       | 546   |      |   |       | 594   |   |   |       | 609   |   |      |       | 596   |      |   |       | 616   |   |   |       | 602   |   |   |       | 632   |   |   |       |  | 
|                                                  | Two years later                    |                       |       | 723   |      |   |       | 780   |  |   |       | 837   |   |      |       | 994   |      |   |       | 1,055 |   |   |       | 1,042 |   |      |       | 1,010 |      |   |       | 985   |   |   |       | 999   |   |   |       |       |   |   |       |  | 
|                                                  | Three years later                  |                       |       | 925   |      |   |       | 1,007 |  |   |       | 1,142 |   |      |       | 1,342 |      |   |       | 1,353 |   |   |       | 1,333 |   |      |       | 1,276 |      |   |       | 1,296 |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Four years later                   |                       |       | 1,098 |      |   |       | 1,208 |  |   |       | 1,349 |   |      |       | 1,518 |      |   |       | 1,546 |   |   |       | 1,506 |   |      |       | 1,553 |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Five years later                   |                       |       | 1,235 |      |   |       | 1,322 |  |   |       | 1,475 |   |      |       | 1,649 |      |   |       | 1,675 |   |   |       | 1,718 |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Six years later                    |                       |       | 1,296 |      |   |       | 1,403 |  |   |       | 1,586 |   |      |       | 1,756 |      |   |       | 1,828 |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Seven years later                  |                       |       | 1,349 |      |   |       | 1,505 |  |   |       | 1,680 |   |      |       | 1,848 |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Eight years later                  |                       |       | 1,427 |      |   |       | 1,593 |  |   |       | 1,758 |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Nine years later                   |                       |       | 1,503 |      |   |       | 1,657 |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Ten years later                    |                       |       | 1,560 |      |   |       |       |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|Liability re-estimated as of:                     |                                    |                       |       |       |      |   |       |       |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       | 
|                                                  | One year later                     |                       |       | 1,912 |      |   |       | 2,001 |  |   |       | 2,107 |   |      |       | 2,113 |      |   |       | 2,034 |   |   |       | 1,846 |   |      |       | 1,690 |      |   |       | 1,740 |   |   |       | 1,962 |   |   |       | 2,523 |   |   |       |  | 
|                                                  | Two years later                    |                       |       | 1,924 |      |   |       | 2,074 |  |   |       | 2,121 |   |      |       | 2,151 |      |   |       | 2,043 |   |   |       | 1,862 |   |      |       | 1,768 |      |   |       | 1,904 |   |   |       | 2,201 |   |   |       |       |   |   |       |  | 
|                                                  | Three years later                  |                       |       | 1,974 |      |   |       | 2,069 |  |   |       | 2,105 |   |      |       | 2,131 |      |   |       | 2,044 |   |   |       | 1,931 |   |      |       | 1,988 |      |   |       | 2,155 |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Four years later                   |                       |       | 1,957 |      |   |       | 2,008 |  |   |       | 2,074 |   |      |       | 2,128 |      |   |       | 2,085 |   |   |       | 2,113 |   |      |       | 2,241 |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Five years later                   |                       |       | 1,898 |      |   |       | 1,977 |  |   |       | 2,066 |   |      |       | 2,150 |      |   |       | 2,216 |   |   |       | 2,292 |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Six years later                    |                       |       | 1,870 |      |   |       | 1,975 |  |   |       | 2,066 |   |      |       | 2,207 |      |   |       | 2,305 |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Seven years later                  |                       |       | 1,870 |      |   |       | 1,958 |  |   |       | 2,068 |   |      |       | 2,244 |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Eight years later                  |                       |       | 1,853 |      |   |       | 1,937 |  |   |       | 2,094 |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Nine years later                   |                       |       | 1,826 |      |   |       | 1,950 |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Ten years later                    |                       |       | 1,834 |      |   |       |       |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |   |       |       |   |   |       |  | 
|                                                  | Cumulative redundancy/(deficiency) |                       | $     | 72    |      |   | $     | 37    |  |   | $     | (102  | ) |      | $     | (110  | )    |   | $     | (317  | ) |   | $     | (461  | ) |      | $     | (574  | )    |   | $     | (481  | ) |   | $     | (356  | ) |   | $     | (181  | ) |   |       |  | 
|                                                  |                                    |                       |       |       |      |   |       |       |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |  
|Gross liability  end of year                     |                                    |                       |       |       |      |   |       |       |  | $ | 2,647 |       |   | $    | 2,894 |       |      | $ | 2,692 |       |   | $ | 2,570 |       |   | $    | 2,566 |       |      | $ | 2,720 |       |   | $ | 2,872 |       |   | $ | 3,400 |       |   | $ | 4,228 | 
|Reinsurance recoverables                          |                                    |                       |       |       |      |   |       |       |  |   | 655   |       |   |      | 760   |       |      |   | 704   |       |   |   | 739   |       |   |      | 899   |       |      |   | 1,046 |       |   |   | 1,027 |       |   |   | 1,058 |       |   |   | 1,092 | 
|                                                  |                                    |                       |       |       |      |   |       |       |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |  
|Net liability  end of year                       |                                    |                       |       |       |      |   |       |       |  |   | 1,992 |       |   |      | 2,134 |       |      |   | 1,988 |       |   |   | 1,831 |       |   |      | 1,667 |       |      |   | 1,674 |       |   |   | 1,845 |       |   |   | 2,342 |       |   |   | 3,136 | 
|                                                  |                                    |                       |       |       |      |   |       |       |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |  
|Gross re-estimated liability at December 31, 2004 |                                    |                       |       |       |      |   |       |       |  |   | 3,055 |       |   |      | 3,245 |       |      |   | 3,404 |       |   |   | 3,518 |       |   |      | 3,565 |       |      |   | 3,598 |       |   |   | 3,551 |       |   |   | 3,684 |       |   |   |       | 
|Re-estimated recoverables at December 31, 2004    |                                    |                       |       |       |      |   |       |       |  |   | 961   |       |   |      | 1,001 |       |      |   | 1,099 |       |   |   | 1,226 |       |   |      | 1,324 |       |      |   | 1,443 |       |   |   | 1,350 |       |   |   | 1,161 |       |   |   |       | 
|                                                  |                                    |                       |       |       |      |   |       |       |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |  
|Net re-estimated liability at December 31, 2004   |                                    |                       |       |       |      |   |       |       |  |   | 2,094 |       |   |      | 2,244 |       |      |   | 2,305 |       |   |   | 2,292 |       |   |      | 2,241 |       |      |   | 2,155 |       |   |   | 2,201 |       |   |   | 2,523 |       |   |   |       | 
|                                                  |                                    |                       |       |       |      |   |       |       |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |  
|Gross cumulative deficiency                       |                                    |                       |       |       |      |   |       |       |  | $ | (408  | )     |   | $    | (351  | )     |      | $ | (712  | )     |   | $ | (948  | )     |   | $    | (999  | )     |      | $ | (878  | )     |   | $ | (679  | )     |   | $ | (284  | )     |   |   |       | 
|                                                  |                                    |                       |       |       |      |   |       |       |  |   |       |       |   |      |       |       |      |   |       |       |   |   |       |       |   |      |       |       |      |   |       |       |  

Investments






19



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##### 













|                                                  |  |                       |         |  |      |   |         | 
|------------------------------------------------- |  | --------------------- | ------- |  | ---- | - | ------- | 
|                                                  |  | At December 31,       |        
|                                                  |  |                       |        
|                                                  |  | 2004                  |         |  | 2003 |  
|                                                  |  |                       |         |  |      |  
|                                                  |  | (Dollars in millions) |        
|Fixed income securities, at fair value            |  | $                     | 2,505.6 |  |      | $ | 1,597.7 | 
|Equity securities, at fair value                  |  |                       | 869.9   |  |      |   | 447.7   | 
|Equity securities, at equity                      |  |                       | 165.5   |  |      |   | 117.5   | 
|Cash, cash equivalents and short-term investments |  |                       | 1,369.8 |  |      |   | 1,806.8 | 
|Other invested assets                             |  |                       | 149.1   |  |      |   | 267.5   | 
|Cash collateral for borrowed securities and other |  |                       | 176.5   |  |      |   |        | 
|                                                  |  |                       |         |  |      |  
|Total cash and invested assets                    |  | $                     | 5,236.4 |  |      | $ | 4,237.2 | 
|                                                  |  |                       |         |  |      |  



Market Sensitive Instruments.


20



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##### 





|                                                                 |                               |                       |         |         |      |   |         |         | 
|---------------------------------------------------------------- | ----------------------------- | --------------------- | ------- | ------- | ---- | - | ------- | ------- | 
|                                                                 |                               | At December 31,       |        
|                                                                 |                               |                       |        
|Type of Investment                                               |                               | 2004                  |         |         | 2003 |  
|                                                                 |                               |                       |         |         |      |  
|                                                                 |                               | (Dollars in millions) |        
|United States government and government agencies and authorities |                               | $                     | 1,363.0 |         |      | $ | 851.5   |        
|States municipalities and political subdivisions                 |                               |                       | 183.5   |         |      |   | 209.1   |        
|Foreign governments                                              |                               |                       | 344.4   |         |      |   | 82.3    |        
|Public utilities                                                 |                               |                       |        |         |      |   | 39.2    |        
|All other corporate                                              |                               |                       | 614.7   |         |      |   | 415.6   |        
|                                                                 |                               |                       |         |         |      |  
|                                                                 | Total fixed income securities |                       |         | 2,505.6 |      |   |         | 1,597.7 | 
|Equity securities                                                |                               |                       | 869.9   |         |      |   | 447.7   |        
|Short-term investments                                           |                               |                       | 213.4   |         |      |   | 218.2   |        
|Cash and cash equivalents                                        |                               |                       | 1,156.4 |         |      |   | 1,588.7 |        
|                                                                 |                               |                       |         |         |      |  
|                                                                 | Total                         |                       | $       | 4,745.3 |      |   | $       | 3,852.3 | 
|                                                                 |                               |                       |         |         |      |  



|                                 |       |                       |         |         |      |   |         |         | 
|-------------------------------- | ----- | --------------------- | ------- | ------- | ---- | - | ------- | ------- | 
|                                 |       | At December 31,       |        
|                                 |       |                       |        
|                                 |       | 2004                  |         |         | 2003 |  
|                                 |       |                       |         |         |      |  
|                                 |       | (Dollars in millions) |        
|Due in less than one year        |       | $                     | 70.7    |         |      | $ | 306.2   |        
|Due after one through five years |       |                       | 237.3   |         |      |   | 129.6   |        
|Due after five through ten years |       |                       | 137.0   |         |      |   | 73.0    |        
|Due after ten years              |       |                       | 2,060.6 |         |      |   | 1,088.9 |        
|                                 |       |                       |         |         |      |  
|                                 | Total |                       | $       | 2,505.6 |      |   | $       | 1,597.7 | 
|                                 |       |                       |         |         |      |  



21



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Quality of Debt Securities in Portfolio.


|                                |       |                 |      |       |   |      |      |       |  
|------------------------------- | ----- | --------------- | ---- | ----- | - | ---- | ---- | ----- | -
|                                |       | At December 31, |     
|                                |       |                 |     
|Rating                          |       |                 | 2004 |       |   | 2003 |     
|                                |       |                 |      |       |   |      |     
|AAA/ Aaa                        |       |                 | 82.4 | %     |   |      | 78.1 | %    
|AA/ Aa2                         |       |                 | 4.0  |       |   |      | 2.4  |      
|A/ A2                           |       |                 | 0.1  |       |   |      | 1.9  |      
|BBB/ Baa2                       |       |                 | 0.2  |       |   |      | 1.1  |      
|BB/ Ba2                         |       |                 | 3.4  |       |   |      | 4.6  |      
|B/ B2                           |       |                 | 1.1  |       |   |      | 4.4  |      
|CCC/ Caa or lower, or not rated |       |                 | 8.8  |       |   |      | 7.5  |      
|                                |       |                 |      |       |   |     
|                                | Total |                 |      | 100.0 | % |      |      | 100.0 | %
|                                |       |                 |      |       |   |     



Competition










22



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##### 





Employees




Regulatory Matters






| |                                      
| | -------------------------------------
| | Regulation of Insurers and Reinsurers



| |        
| | -------
| | General







| |                                     
| | ------------------------------------
| | Insurance Holding Company Regulation





23



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##### 













| |          
| | ---------
| | Dividends





24



---



##### 











| |                                     
| | ------------------------------------
| | Credit for Reinsurance and Licensing





| |                       
| | ----------------------
| | Investment Limitations



25



---



##### 







| |                        
| | -----------------------
| | Liquidation of Insurers







| |                                                                                   
| | ----------------------------------------------------------------------------------
| | The National Association of Insurance Commissioners
    (NAIC) and Accreditation





| |                                
| | -------------------------------
| | Risk-Based Capital Requirements



26



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##### 





| |                                                
| | -----------------------------------------------
| | Codification of Statutory Accounting Principles





| |                                  
| | ---------------------------------
| | Guaranty Funds and Shared Markets





| |                                     
| | ------------------------------------
| | Legislative and Regulatory Proposals







| |   |                                                                                                                  
| | - | -----------------------------------------------------------------------------------------------------------------
| |  | providing government supported insurance and reinsurance
    capacity in markets and to consumers that we target;
|
| |  | requiring our participation in pools and guaranty associations;                                                  
|
| |  | regulating the terms of insurance and reinsurance policies; or                                                   
|
| |  | disproportionately benefiting the companies of one country over
    those of another.                            



| |                                     
| | ------------------------------------
| | Terrorism Risk Insurance Act of 2002



27



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##### 













| |                            
| | ---------------------------
| | Other Industry Developments





Risk Factors






| |                               
| | ------------------------------
| | Risks Relating to Our Business



| |                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------
| | We operate in a highly competitive environment which could
    make it more difficult for us to attract and retain business.



28



---



##### 













| |                                                                                                      
| | -----------------------------------------------------------------------------------------------------
| | Our actual claims may exceed our claim reserves causing us to
    incur losses we did not anticipate.









29



---



##### 





| |                                                                            
| | ---------------------------------------------------------------------------
| | Emerging claim and coverage issues could adversely affect our
    business.







| |                                                                                                                       
| | ----------------------------------------------------------------------------------------------------------------------
| | Unpredictable natural and man-made catastrophic events could
    cause unanticipated losses and reduce our net income.





| |                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------
| | Consolidation in the insurance industry could lead to lower
    margins for us and less demand for our reinsurance products.





| |                                                                                                                                                                   
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | A change in demand for reinsurance and insurance could lead
    to reduced premium rates and less favorable contract terms,
    which could reduce our net income.



30



---



##### 









| |                                                                                                                                                                                                
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If we are unable to maintain a favorable financial strength
    rating, certain existing business may be subject to termination,
    and it may be more difficult for us to write new business.







| |                                                                                                                                                                                                                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If our current and potential customers change their trading
    requirements with respect to minimum required financial strength
    or claims paying ratings, or materially increase their
    counterparty collateral requirements, the demand for our
    products could be reduced and our profitability could be
    adversely affected.





| |                                                                                                              
| | -------------------------------------------------------------------------------------------------------------
| | If we are unable to realize our investment objectives, our
    financial condition may be adversely affected.



31



---



##### 







| |                                                                   
| | ------------------------------------------------------------------
| | We may be adversely affected by foreign currency
    fluctuations.





| |                                                                                                                                                             
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The covenants in our debt agreements limit our financial and
    operational flexibility, which could have an adverse effect on
    our financial condition.





| |                                                                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We are a holding company and are dependent on dividends and
    other payments from our operating subsidiaries, which are
    subject to dividend restrictions.





| |                                                                                       
| | --------------------------------------------------------------------------------------
| | Our business could be adversely affected by the loss of one
    or more key employees.





| |                                                                                                                                                                                     
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our business is primarily dependent upon a limited number of
    unaffiliated reinsurance brokers and the loss of business
    provided by them could adversely affect our business.



32



---



##### 





| |                                                                                    
| | -----------------------------------------------------------------------------------
| | Our reliance on payments through reinsurance brokers exposes
    us to credit risk.





| |                                                                                                                                                                           
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our computer and data processing systems may fail or be
    perceived to be insecure, which could adversely affect our
    business and damage our customer relationships.









| |                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We may not be able to alleviate risk successfully through
    retrocessional arrangements and we are subject to credit risks
    with respect to our retrocessionaires.





33



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##### 





| |                                                                                                                                                                 
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our business could be adversely affected as a result of
    political, regulatory, economic or other influences in the
    insurance and reinsurance industries.













| |   |                                                                                           
| | - | ------------------------------------------------------------------------------------------
| |  | provide insurance and reinsurance capacity in markets and to
    consumers that we target;
|
| |  | require our participation in industry pools and guaranty
    associations;                
|
| |  | mandate the terms of insurance and reinsurance policies; or                               
|
| |  | disproportionately benefit the companies of one country over
    those of another.        



| |                                                                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Certain business practices of the insurance industry have
    become the subject of investigations by government authorities
    and the subject of class action litigation.





34



---



##### 







| |                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The growth of our primary insurance business, which is
    regulated more comprehensively than reinsurance, increases our
    exposure to adverse political, judicial and legal
    developments.





| |                                                                                                                                           
| | ------------------------------------------------------------------------------------------------------------------------------------------
| | Our utilization of program managers and other third parties
    to support our business exposes us to operational and financial
    risks.







| |                                                                                               
| | ----------------------------------------------------------------------------------------------
| | We could be adversely affected if the Terrorism Risk
    Insurance Act of 2002 is not renewed.



35



---



##### 







| |                                  
| | ---------------------------------
| | Risks Related to Our Common Stock



| |                                                                                                                                                                                         
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Because our controlling stockholder intends to retain
    control, you may be unable to realize a gain on your investment
    in our common stock in connection with an acquisition bid.





| |   |                                                                                                        
| | - | -------------------------------------------------------------------------------------------------------
| |  | electing members of our Board of Directors;                                                            
|
| |  | adopting amendments to our charter documents; and                                                      
|
| |  | approving a merger or consolidation, liquidation or sale of all
    or substantially all of our assets.







| |                                                                                                                                   
| | ----------------------------------------------------------------------------------------------------------------------------------
| | Significant fluctuation in the market price of our common
    stock could result in securities class action claims against
    us.





| |                                                                                                                                                                                                            
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Provisions in our charter documents and Delaware law may
    impede attempts to replace or remove our management or inhibit a
    takeover, which could adversely affect the value of our common
    stock.





| |   |                                                                                                                                                                                       
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | authorizing the issuance of preferred stock, the terms of which
    may be determined at the sole discretion of our Board of
    Directors;                                           
|
| |  | establishing advance notice requirements for nominations for
    election to our Board of Directors or for proposing matters that
    can be acted on by stockholders at meetings; and
|
| |  | providing that special meetings of stockholders may be called
    only by our Board of Directors, the chairman of our Board of
    Directors, our president or our secretary.         

36



---



##### 





Company Website









|        |           
|------- | ----------
|Item 2. | Properties








|        |                  
|------- | -----------------
|Item 3. | Legal Proceedings














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



37



---



##### 






PART II







|        |                                                                                                                     
|------- | --------------------------------------------------------------------------------------------------------------------
|Item 5. | Market for Registrants Common Equity, Related
    Stockholder Matters and Issuer Purchases of
    Equity Securities

Market Information and Holders of Common Stock




|                   |  |      |       |  |     |   |       | 
|------------------ |  | ---- | ----- |  | --- | - | ----- | 
|Quarter Ended      |  | High |       |  | Low |  
|                   |  |      |       |  |     |  
|March 31, 2004     |  | $    | 27.14 |  |     | $ | 22.28 | 
|June 30, 2004      |  |      | 27.80 |  |     |   | 23.57 | 
|September 30, 2004 |  |      | 24.64 |  |     |   | 21.40 | 
|December 31, 2004  |  |      | 25.40 |  |     |   | 20.09 | 
|                  
|March 31, 2003     |  | $    | 19.28 |  |     | $ | 15.55 | 
|June 30, 2003      |  |      | 22.53 |  |     |   | 17.88 | 
|September 30, 2003 |  |      | 22.17 |  |     |   | 18.00 | 
|December 31, 2003  |  |      | 23.29 |  |     |   | 20.10 | 



Dividends






38



---



##### 



Issuer Purchases of Equity Securities




|                               |  |              |   |     |               |                  |   |             |                |  |                 |  |  |  |         | 
|------------------------------ |  | ------------ | - | --- | ------------- | ---------------- | - | ----------- | -------------- |  | --------------- |  |  |  | ------- | 
|                               |  |              |   |     |               | Total Number     |   |             | Maximum        | 
|                               |  |              |   |     |               | of Shares        |   |             | Number         | 
|                               |  |              |   |     |               | Purchased as     |   |             | of Shares that | 
|                               |  |              |   |     |               | Part of Publicly |   |             | may yet be     | 
|                               |  | Total Number |   |     | Average Price |                  |   | Announced   |                |  | Purchased under | 
|                               |  | of Shares    |   |     | Paid per      |                  |   | Plans or    |                |  | the Plans or    | 
|Period                         |  | Purchased    |   |     | Share         |                  |   | Programs(1) |                |  | Programs        | 
|                               |  |              |   |     |               |                  |   |             |                |  |                 | 
|October 1  October 31, 2004   |  |              |  |     |               |                  |  |             |                |  |                |  |  |  | 587,000 | 
|November 1  November 30, 2004 |  |              |  | (2) |               |                  |  | (2)         |                |  |                |  |  |  | 587,000 | 
|December 1  December 31, 2004 |  |              |  |     |               |                  |  |             |                |  |                |  |  |  | 587,000 | 
|                               |  |              |   |     |               |                  |   |             |                |  |                 | 
|Total                          |  |              |  |     |               |                  |  |             |                |  |                |  |  |  | 587,000 | 
|                               |  |              |   |     |               |                  |   |             |                |  |                 | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The Odyssey Re Holdings Corp. stock repurchase program was
    publicly announced on December 19, 2003. It was effective
    as of such date and expires two years following such date. The
    Company may repurchase up to 1,000,000 shares of its common
    stock from time to time, in the open market, through block
    trades or otherwise.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   
|(2) | In November 2004, we purchased $100,000 aggregate principal
    amount of our 4.375% convertible senior debentures due 2022
    (Convertible Debentures), in open-market
    transactions, at an average price of 113.8% of the principal
    amount purchased. The purchase of the Convertible Debentures was
    not made pursuant to a publicly announced plan or program. Under
    certain circumstances, each $1,000 principal amount of
    Convertible Debentures is convertible into 46.9925 shares of our
    common stock, and as a result, under such circumstances,
    $100,000 aggregate principal amount of Convertible Debentures
    would be convertible into 4,699 shares of our common stock.
    For more information regarding our Convertible Debentures, see
    note 17 to our consolidated financial statements.






|        |                        
|------- | -----------------------
|Item 6. | Selected Financial Data





39



---



##### 





|                                                                                                |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |           |           |  |   |         |         | 
|----------------------------------------------------------------------------------------------- | -------------- | --------------------------------------------- | --------- | --------- | ---- | - | --------- | --------- |  | - | --------- | --------- |  | ---- | --------- | --------- |  | - | ------- | ------- | 
|                                                                                                |                | Years Ended December 31,                      |          
|                                                                                                |                |                                               |          
|                                                                                                |                | 2004                                          |           |           | 2003 |   |           | 2002      |  |   | 2001      |           |  | 2000 |          
|                                                                                                |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |          
|                                                                                                |                | (Dollars in thousands, except per share data) |          
|GAAP Statement of Operations Data:                                                              |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |           |           |  |   |         |        
|Gross premiums written                                                                          |                | $                                             | 2,656,509 |           |      | $ | 2,558,156 |           |  | $ | 1,894,530 |           |  | $    | 1,153,606 |           |  | $ | 862,166 |        
|                                                                                                |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |          
|Net premiums written                                                                            |                | $                                             | 2,362,577 |           |      | $ | 2,153,580 |           |  | $ | 1,631,245 |           |  | $    | 984,650   |           |  | $ | 701,334 |        
|                                                                                                |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |          
|Net premiums earned                                                                             |                | $                                             | 2,331,067 |           |      | $ | 1,965,093 |           |  | $ | 1,432,642 |           |  | $    | 900,537   |           |  | $ | 681,831 |        
|Net investment income                                                                           |                |                                               | 164,703   |           |      |   | 134,115   |           |  |   | 123,028   |           |  |      | 114,600   |           |  |   | 126,593 |        
|Net realized investment gains                                                                   |                |                                               | 113,464   |           |      |   | 202,742   |           |  |   | 135,796   |           |  |      | 13,313    |           |  |   | 23,611  |        
|                                                                                                |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |          
|                                                                                                | Total revenues |                                               |           | 2,609,234 |      |   |           | 2,301,950 |  |   |           | 1,691,466 |  |      |           | 1,028,450 |  |   |         | 832,035 | 
|                                                                                                |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |          
|Losses and loss adjustment expenses                                                             |                |                                               | 1,629,564 |           |      |   | 1,325,765 |           |  |   | 987,195   |           |  |      | 725,767   |           |  |   | 503,464 |        
|Acquisition costs                                                                               |                |                                               | 528,425   |           |      |   | 476,015   |           |  |   | 362,262   |           |  |      | 248,425   |           |  |   | 198,570 |        
|Other underwriting expenses                                                                     |                |                                               | 125,679   |           |      |   | 101,308   |           |  |   | 70,269    |           |  |      | 64,694    |           |  |   | 53,254  |        
|Other expense (income), net                                                                     |                |                                               | 21,207    |           |      |   | 7,912     |           |  |   | 4,985     |           |  |      | (755      | )         |  |   | (3,839  | )      
|Interest expense                                                                                |                |                                               | 25,609    |           |      |   | 12,656    |           |  |   | 8,689     |           |  |      | 5,938     |           |  |   |        |        
|                                                                                                |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |          
|                                                                                                | Total expenses |                                               |           | 2,330,484 |      |   |           | 1,923,656 |  |   |           | 1,433,400 |  |      |           | 1,044,069 |  |   |         | 751,449 | 
|                                                                                                |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |          
|Income (loss) before income taxes and cumulative effect of a
    change in accounting principle |                |                                               | 278,750   |           |      |   | 378,294   |           |  |   | 258,066   |           |  |      | (15,619   | )         |  |   | 80,586  |        
|Federal and foreign income tax provision (benefit)                                              |                |                                               | 91,851    |           |      |   | 129,069   |           |  |   | 86,751    |           |  |      | (7,658    | )         |  |   | 25,795  |        
|                                                                                                |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |          
|Income (loss) before cumulative effect of a change in accounting
    principle                  |                |                                               | 186,899   |           |      |   | 249,225   |           |  |   | 171,315   |           |  |      | (7,961    | )         |  |   | 54,791  |        
|Cumulative effect of a change in accounting principle                                           |                |                                               |          |           |      |   |          |           |  |   | 36,862    |           |  |      |          |           |  |   |        |        
|                                                                                                |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |          
|Net income (loss), as reported                                                                  |                |                                               | 186,899   |           |      |   | 249,225   |           |  |   | 208,177   |           |  |      | (7,961    | )         |  |   | 54,791  |        
|Adjustments:                                                                                    |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |           |           |  |   |         |        
|Negative goodwill                                                                               |                |                                               |          |           |      |   |          |           |  |   |          |           |  |      | (8,348    | )         |  |   | (8,348  | )      
|Goodwill                                                                                        |                |                                               |          |           |      |   |          |           |  |   |          |           |  |      | 2,516     |           |  |   | 2,516   |        
|                                                                                                |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |          
|Adjusted net income (loss)(1)                                                                   |                | $                                             | 186,899   |           |      | $ | 249,225   |           |  | $ | 208,177   |           |  | $    | (13,793   | )         |  | $ | 48,959  |        
|                                                                                                |                |                                               |           |           |      |   |           |           |  |   |           |           |  |      |          

40



---



##### 



|                                                                                                    |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |            |   |  |   |            |  
|--------------------------------------------------------------------------------------------------- |  | --------------------------------------------- | ---------- |  | ---- | - | ---------- | ---- |  | - | ---------- |  |  | ---- | ---------- | - |  | - | ---------- | -
|                                                                                                    |  | Years Ended December 31,                      |           
|                                                                                                    |  |                                               |           
|                                                                                                    |  | 2004                                          |            |  | 2003 |   |            | 2002 |  |   | 2001       |  |  | 2000 |           
|                                                                                                    |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |           
|                                                                                                    |  | (Dollars in thousands, except per share data) |           
|BASIC                                                                                               |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |            |   |  |   |            |  
|Weighted average shares outstanding                                                                 |  |                                               | 64,361,535 |  |      |   | 64,736,830 |      |  |   | 64,744,067 |  |  |      | 57,018,497 |   |  |   | 48,000,000 |  
|                                                                                                    |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |           
|Basic earnings (loss) per share, before cumulative effect of a
    change in accounting principle   |  | $                                             | 2.90       |  |      | $ | 3.85       |      |  | $ | 2.65       |  |  | $    | (0.14      | ) |  | $ | 1.14       |  
|Cumulative effect of a change in accounting principle                                               |  |                                               |           |  |      |   |           |      |  |   | 0.57       |  |  |      |           |   |  |   |           |  
|                                                                                                    |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |           
|Basic earnings (loss) per share, as reported                                                        |  |                                               | 2.90       |  |      |   | 3.85       |      |  |   | 3.22       |  |  |      | (0.14      | ) |  |   | 1.14       |  
|Adjustments:                                                                                        |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |            |   |  |   |            |  
|Negative goodwill                                                                                   |  |                                               |           |  |      |   |           |      |  |   |           |  |  |      | (0.15      | ) |  |   | (0.17      | )
|Goodwill                                                                                            |  |                                               |           |  |      |   |           |      |  |   |           |  |  |      | 0.05       |   |  |   | 0.05       |  
|                                                                                                    |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |           
|Adjusted basic earnings (loss) per share(1)                                                         |  | $                                             | 2.90       |  |      | $ | 3.85       |      |  | $ | 3.22       |  |  | $    | (0.24      | ) |  | $ | 1.02       |  
|                                                                                                    |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |           
|DILUTED                                                                                             |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |            |   |  |   |            |  
|Weighted average shares outstanding                                                                 |  |                                               | 69,993,136 |  |      |   | 70,279,467 |      |  |   | 67,919,664 |  |  |      | 57,018,497 |   |  |   | 48,000,000 |  
|                                                                                                    |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |           
|Diluted earnings (loss) per share, before cumulative effect of a
    change in accounting principle |  | $                                             | 2.71       |  |      | $ | 3.59       |      |  | $ | 2.55       |  |  | $    | (0.14      | ) |  | $ | 1.14       |  
|Cumulative effect of a change in accounting principle                                               |  |                                               |           |  |      |   |           |      |  |   | 0.54       |  |  |      |           |   |  |   |           |  
|                                                                                                    |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |           
|Diluted earnings (loss) per share, as reported                                                      |  |                                               | 2.71       |  |      |   | 3.59       |      |  |   | 3.09       |  |  |      | (0.14      | ) |  |   | 1.14       |  
|Adjustments:                                                                                        |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |            |   |  |   |            |  
|Negative goodwill                                                                                   |  |                                               |           |  |      |   |           |      |  |   |           |  |  |      | (0.15      | ) |  |   | (0.17      | )
|Goodwill                                                                                            |  |                                               |           |  |      |   |           |      |  |   |           |  |  |      | 0.05       |   |  |   | 0.05       |  
|                                                                                                    |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |           
|Adjusted diluted earnings (loss) per share(1)(2)(3)                                                 |  | $                                             | 2.71       |  |      | $ | 3.59       |      |  | $ | 3.09       |  |  | $    | (0.24      | ) |  | $ | 1.02       |  
|                                                                                                    |  |                                               |            |  |      |   |            |      |  |   |            |  |  |      |           

41



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##### 



|                                           |  |                                               |           |   |      |   |           |      |  |   |           |   |  |      |           |   |  |   |           |  
|------------------------------------------ |  | --------------------------------------------- | --------- | - | ---- | - | --------- | ---- |  | - | --------- | - |  | ---- | --------- | - |  | - | --------- | -
|                                           |  | Years Ended December 31,                      |          
|                                           |  |                                               |          
|                                           |  | 2004                                          |           |   | 2003 |   |           | 2002 |  |   | 2001      |   |  | 2000 |          
|                                           |  |                                               |           |   |      |   |           |      |  |   |           |   |  |      |          
|                                           |  | (Dollars in thousands, except per share data) |          
|Selected GAAP Financial Ratios:            |  |                                               |           |   |      |   |           |      |  |   |           |   |  |      |           |   |  |   |           |  
|Losses and loss adjustment expense ratio   |  |                                               | 69.9      | % |      |   | 67.5      | %    |  |   | 68.9      | % |  |      | 80.6      | % |  |   | 73.9      | %
|Underwriting expense ratio                 |  |                                               | 28.1      |   |      |   | 29.3      |      |  |   | 30.2      |   |  |      | 34.8      |   |  |   | 36.9      |  
|                                           |  |                                               |           |   |      |   |           |      |  |   |           |   |  |      |          
|Combined ratio                             |  |                                               | 98.0      | % |      |   | 96.8      | %    |  |   | 99.1      | % |  |      | 115.4     | % |  |   | 110.8     | %
|                                           |  |                                               |           |   |      |   |           |      |  |   |           |   |  |      |          
|GAAP Balance Sheet Data:                   |  |                                               |           |   |      |   |           |      |  |   |           |   |  |      |           |   |  |   |           |  
|Total investments and cash                 |  | $                                             | 5,236,451 |   |      | $ | 4,237,248 |      |  | $ | 3,082,403 |   |  | $    | 2,659,776 |   |  | $ | 2,641,615 |  
|Total assets                               |  |                                               | 7,705,775 |   |      |   | 6,460,056 |      |  |   | 5,303,675 |   |  |      | 4,648,291 |   |  |   | 4,254,103 |  
|Unpaid losses and loss adjustment expenses |  |                                               | 4,228,021 |   |      |   | 3,400,277 |      |  |   | 2,871,552 |   |  |      | 2,720,220 |   |  |   | 2,566,396 |  
|Debt obligations                           |  |                                               | 376,040   |   |      |   | 376,892   |      |  |   | 206,340   |   |  |      | 200,000   |   |  |   |          |  
|Total stockholders equity                 |  |                                               | 1,585,500 |   |      |   | 1,390,235 |      |  |   | 1,056,083 |   |  |      | 820,872   |   |  |   | 957,875   |  
|Book value per share(4)                    |  |                                               | 24.48     |   |      |   | 21.39     |      |  |   | 16.25     |   |  |      | 12.60     |   |  |   | 19.96     |  
|Dividends per share(4)                     |  |                                               | 0.13      |   |      |   | 0.11      |      |  |   | 0.10      |   |  |      | 0.03      |   |  |   | 1.77      |  






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Assumes retroactive implementation of SFAS Nos. 141 and
    142, which relate to goodwill and negative goodwill. These
    statements were adopted by us on January 1, 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   
|(2) | The Emerging Issues Task Force (EITF) Issue 4-08
    The Effect of Contingently Convertible Instruments on
    Diluted Earnings Per Share, which is effective for periods
    ending after December 15, 2004, requires that the dilutive
    effect of contingently convertible debt securities, with a
    market price threshold, should be included in diluted earnings
    per share. The terms of our convertible senior debentures, which
    were issued in June 2002, (see note 17 of our consolidated
    financial statements) meet the criteria defined in EITF Issue
    4-08, and accordingly, the effect of conversion of our senior
    debentures to common stock has been assumed when calculating our
    diluted earnings per share. The diluted earnings per share for
    the years ended December 31, 2003 and 2002 have been
    restated to conform to the requirements of EITF Issue 4-08. See
    notes 2(k) and 8 of our consolidated financial statements
    included in this Form 10-K.
|   
|(3) | Inclusion of the unvested portion of restricted common stock
    granted under the Odyssey Re Holdings Corp. Restricted Share
    Plan would have an anti-dilutive effect on the 2001 diluted
    earnings per share (i.e., the diluted earnings per share would
    be greater than the basic earnings per share); accordingly, such
    shares were excluded from the calculation of the 2001 earnings
    per share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   
|(4) | Based on our common stock outstanding of: 64,754,978 shares
    as of December 31, 2004; 64,996,166 shares as of
    December 31, 2003; 65,003,963 shares as of
    December 31, 2002; 65,142,857 shares as of
    December 31, 2001; and 48,000,000 shares as of
    December 31, 2000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 






|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|Item 7. | Managements Discussion and Analysis of Financial
    Condition and Results of Operations

Overview




42



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##### 

















43



---



##### 







Revenues






44



---



##### 





|              |  |                                 |       |                    |              |   |       |        |  |   |       |  |  |      |      |   |      |   |      |  |  |   |      | 
|------------- |  | ------------------------------- | ----- | ------------------ | ------------ | - | ----- | ------ |  | - | ----- |  |  | ---- | ---- | - | ---- | - | ---- |  |  | - | ---- | 
|              |  |                                 |       |                    |              |   |       | Change | 
|              |  |                                 |       | For the Year Ended |             
|              |  | As of December 31,              |       |                    | December 31, |  
|              |  |                                 |       |                    |              |  
|Division      |  | 2004                            |       |                    | 2003         |   |       | 2002   |  |   | 2004  |  |  | 2003 |      |   | 2002 |  
|              |  |                                 |       |                    |              |   |       |        |  |   |       |  |  |      |      |   |      |  
|              |  | Gross Premiums Written         
|Americas      |  | $                               | 269.0 |                    |              | $ | 270.7 |        |  | $ | 245.9 |  |  | $    | (1.7 | ) |      | $ | 24.8 |  |  | $ | 42.6 | 
|EuroAsia      |  |                                 | 115.6 |                    |              |   | 76.0  |        |  |   | 58.7  |  |  |      | 39.6 |   |      |   | 17.3 |  |  |   | 17.1 | 
|London Market |  |                                 | 61.2  |                    |              |   | 55.6  |        |  |   | 50.8  |  |  |      | 5.6  |   |      |   | 4.8  |  |  |   | 10.5 | 
|              |  |                                 |       |                    |              |   |       |        |  |   |       |  |  |      |      |   |      |  
|Total         |  | $                               | 445.8 |                    |              | $ | 402.3 |        |  | $ | 355.4 |  |  | $    | 43.5 |   |      | $ | 46.9 |  |  | $ | 70.2 | 
|              |  |                                 |       |                    |              |   |       |        |  |   |       |  |  |      |      |   |      |  
|             
|              |  | Acquisition Costs              
|Americas      |  | $                               | 88.6  |                    |              | $ | 96.3  |        |  | $ | 63.4  |  |  | $    | (7.7 | ) |      | $ | 32.9 |  |  | $ | 17.3 | 
|EuroAsia      |  |                                 | 33.1  |                    |              |   | 23.8  |        |  |   | 18.4  |  |  |      | 9.3  |   |      |   | 5.4  |  |  |   | 5.4  | 
|London Market |  |                                 | 10.7  |                    |              |   | 12.9  |        |  |   | 11.4  |  |  |      | (2.2 | ) |      |   | 1.6  |  |  |   | 8.0  | 
|              |  |                                 |       |                    |              |   |       |        |  |   |       |  |  |      |      |   |      |  
|Total         |  | $                               | 132.4 |                    |              | $ | 133.0 |        |  | $ | 93.2  |  |  | $    | (0.6 | ) |      | $ | 39.9 |  |  | $ | 30.7 | 
|              |  |                                 |       |                    |              |   |       |        |  |   |       |  |  |      |      |   |      |  
|             
|              |  | Reinsurance Balances Receivable
|Americas      |  | $                               | 186.8 |                    |              | $ | 194.4 |        |  | $ | 178.6 |  |  | $    | (7.6 | ) |      | $ | 15.8 |  |  | $ | 19.5 | 
|EuroAsia      |  |                                 | 79.6  |                    |              |   | 52.4  |        |  |   | 40.3  |  |  |      | 27.2 |   |      |   | 12.1 |  |  |   | 11.6 | 
|London Market |  |                                 | 36.8  |                    |              |   | 45.6  |        |  |   | 42.2  |  |  |      | (8.8 | ) |      |   | 3.4  |  |  |   | 15.2 | 
|              |  |                                 |       |                    |              |   |       |        |  |   |       |  |  |      |      |   |      |  
|Total         |  | $                               | 303.2 |                    |              | $ | 292.4 |        |  | $ | 261.1 |  |  | $    | 10.8 |   |      | $ | 31.3 |  |  | $ | 46.3 | 
|              |  |                                 |       |                    |              |   |       |        |  |   |       |  |  |      |      |   |      |  
|             
|              |  | Unearned Premium Reserve       
|Americas      |  | $                               | 162.7 |                    |              | $ | 167.6 |        |  | $ | 115.8 |  |  | $    | (4.8 | ) |      | $ | 51.7 |  |  | $ | 11.9 | 
|EuroAsia      |  |                                 | 97.3  |                    |              |   | 55.7  |        |  |   | 40.3  |  |  |      | 41.6 |   |      |   | 15.4 |  |  |   | 11.6 | 
|London Market |  |                                 | 13.6  |                    |              |   | 18.9  |        |  |   | 12.9  |  |  |      | (5.4 | ) |      |   | 6.0  |  |  |   | 11.5 | 
|              |  |                                 |       |                    |              |   |       |        |  |   |       |  |  |      |      |   |      |  
|Total         |  | $                               | 273.6 |                    |              | $ | 242.2 |        |  | $ | 169.0 |  |  | $    | 31.4 |   |      | $ | 73.1 |  |  | $ | 35.0 | 
|              |  |                                 |       |                    |              |   |       |        |  |   |       |  |  |      |      |   |      |  



Expenses




45



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##### 



















46



---



##### 







Results of Operations




| |                                                                          
| | -------------------------------------------------------------------------
| | Year Ended December 31, 2004 Compared to Year Ended
    December 31, 2003

Gross Premiums Written.










47



---



##### 













Ceded Premiums Written.


Net Premiums Written.


Net Premiums Earned.


48



---



##### 





Net Investment Income.


Net Realized Investment Gains.




Losses and Loss Adjustment Expenses.




49



---



##### 











Acquisition Costs.


Other Underwriting Expenses.


Other Expenses, Net.


Interest Expense.


50



---



##### 



Federal and Foreign Income Tax Provision.




| |                                                                          
| | -------------------------------------------------------------------------
| | Year Ended December 31, 2003 Compared to Year Ended
    December 31, 2002

Gross Premiums Written.














51



---



##### 









Ceded Premiums Written.


Net Premiums Written.


Net Premiums Earned.


Net Investment Income.


Net Realized Investment Gains.




Losses and Loss Adjustment Expenses.


52



---



##### 





Acquisition Costs.


Other Underwriting Expenses.


Other Expenses (Income), Net.


Interest Expense.


Federal and Foreign Income Tax Provision.


Liquidity and Capital Resources






53



---



##### 















54



---



##### 













Financial Strength and Credit Ratings






55



---



##### 







Accounting Pronouncements












Off-Balance Sheet Arrangements




56



---



##### 



Market Sensitive Instruments








Interest Rate Risk




|                                 |  |                         |         |  |                         |   |               |        |  |       |           |    |  |              |              |  |        |   |        |   |  |  |       |   
|-------------------------------- |  | ----------------------- | ------- |  | ----------------------- | - | ------------- | ------ |  | ----- | --------- | -- |  | ------------ | ------------ |  | ------ | - | ------ | - |  |  | ----- | --
|                                 |  | As of December 31, 2004 |         |  | As of December 31, 2003 |  
|                                 |  |                         |         |  |                         |  
|                                 |  | Fair Value of           |         |  |                         |   | Fair Value of |        |  |      
|                                 |  | Fixed                   |         |  |                         |   | Hypothetical  |        |  | Fixed |           |    |  |              | Hypothetical | 
|                                 |  | Income                  |         |  | Hypothetical            |   |               | %      |  |       | Income    |    |  | Hypothetical |              |  | %      |  
|Percent Change in Interest Rates |  | Portfolio               |         |  | $ Change                |   |               | Change |  |       | Portfolio |    |  | $ Change     |              |  | Change |  
|                                 |  |                         |         |  |                         |   |               |        |  |       |           |    |  |              |              |  |        |  
|                                 |  | (Dollars in millions)   |        
|200 basis point rise             |  | $                       | 2,073.7 |  |                         | $ | (431.9        | )      |  |       | (17.2     | )% |  | $            | 1,386.8      |  |        | $ | (210.9 | ) |  |  | (13.2 | )%
|100 basis point rise             |  |                         | 2,271.5 |  |                         |   | (234.1        | )      |  |       | (9.3      | )  |  |              | 1,487.2      |  |        |   | (110.5 | ) |  |  | (6.9  | ) 
|Base Scenario                    |  |                         | 2,505.6 |  |                         |   |              |        |  |       |          |    |  |              | 1,597.7      |  |        |   |       |   |  |  |      |   
|100 basis point decline          |  |                         | 2,795.1 |  |                         |   | 289.5         |        |  |       | 11.6      |    |  |              | 1,748.7      |  |        |   | 151.0  |   |  |  | 9.5   |   
|200 basis point decline          |  |                         | 3,110.4 |  |                         |   | 604.8         |        |  |       | 24.1      |    |  |              | 1,916.4      |  |        |   | 318.7  |   |  |  | 19.9  |   







| |                                                                       
| | ----------------------------------------------------------------------
| | Disclosure about Limitations of Interest Rate Sensitivity
    Analysis







| |            
| | -----------
| | Credit Risk





57



---



##### 







| |                  
| | -----------------
| | Equity Price Risk















| |                      
| | ---------------------
| | Foreign Currency Risk



58



---



##### 







| |                           
| | --------------------------
| | Investment Impairment Risk





59



---



##### 





|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |           |           |           |   |          |         |         |   |    |    |    | 
|---------------------------------------------- | ------------------------------------------------- | --------------------------- | --------- | ---------- | ---------------------- | - | --------- | ---------- | ------- | - | ---------- | ---------- | -- | ------------ | --------- | ------- | ---------- | ----- | ------- | ---------- | ------- | - | ------------ | - | - | ---------- | --------- | --------- | --------- | - | -------- | ------- | ------- | - | -- | -- | -- | 
|                                               |                                                   | Duration of Unrealized Loss |           |            |                        |   |           |            |        
|                                               |                                                   |                             |           |            |                        |   |           |            |        
|                                               |                                                   | Less than 12 Months         |           |            | Greater than 12 Months |   |           | Total      |        
|                                               |                                                   |                             |           |            |                        |   |           |            |        
|                                               |                                                   |                             |           | Gross      |                        |   |           |            |         |   | Gross      |            |    |              |           |         |            | Gross |         |            |        
|                                               |                                                   |                             |           | Unrealized |                        |   | Number of |            |         |   |            | Unrealized |    |              | Number of |         |            |       |         | Unrealized |         |   | Number of    |  
|                                               |                                                   | Fair Value                  |           |            | Depreciation           |   |           | Securities |         |   | Fair Value |            |    | Depreciation |           |         | Securities |       |         | Fair Value |         |   | Depreciation |   |   | Securities |          
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          
|Fixed income securities investment grade:      |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |           |           |           |   |          |         |         |   |    |   
|                                               | United States government agencies and authorities |                             | $         | 667,309    |                        |   | $         | (17,214    | )       |   |            | 16         |    |              | $         | 511,952 |            |       | $       | (32,822    | )       |   |              | 4 |   |            | $         | 1,179,261 |           |   | $        | (50,036 | )       |   |    | 20 |   
|                                               | States, municipalities and political subdivisions |                             |           | 25,995     |                        |   |           | (358       | )       |   |            | 5          |    |              |           | 10,311  |            |       |         | (323       | )       |   |              | 2 |   |            |           | 36,306    |           |   |          | (681    | )       |   |    | 7  |   
|                                               | All other corporate                               |                             |           | 172,495    |                        |   |           | (1,501     | )       |   |            | 2          |    |              |           |        |            |       |         |           |         |   |              |  |   |            |           | 172,495   |           |   |          | (1,501  | )       |   |    | 2  |   
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          
|                                               |                                                   | Total investment grade      |           |            | 865,799                |   |           |            | (19,073 | ) |            |            | 23 |              |           |         | 522,263    |       |         |            | (33,145 | ) |              |   | 6 |            |           |           | 1,388,062 |   |          |         | (52,218 | ) |    |    | 29 | 
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          
|Fixed income securities non- investment grade: |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |           |           |           |   |          |         |         |   |    |   
|                                               | States, municipalities and political subdivisions |                             |           | 4,010      |                        |   |           | (6,352     | )       |   |            | 1          |    |              |           |        |            |       |         |           |         |   |              |  |   |            |           | 4,010     |           |   |          | (6,352  | )       |   |    | 1  |   
|                                               | All other corporate                               |                             |           | 114,267    |                        |   |           | (14,052    | )       |   |            | 6          |    |              |           |        |            |       |         |           |         |   |              |  |   |            |           | 114,267   |           |   |          | (14,052 | )       |   |    | 6  |   
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          
|                                               |                                                   | Total non-investment grade  |           |            | 118,277                |   |           |            | (20,404 | ) |            |            | 7  |              |           |         |           |       |         |            |        |   |              |   |  |            |           |           | 118,277   |   |          |         | (20,404 | ) |    |    | 7  | 
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          
|                                               |                                                   | Total fixed income          |           |            | 984,076                |   |           |            | (39,477 | ) |            |            | 30 |              |           |         | 522,263    |       |         |            | (33,145 | ) |              |   | 6 |            |           |           | 1,506,339 |   |          |         | (72,622 | ) |    |    | 36 | 
|Common stocks, at fair value                   |                                                   |                             | 131,520   |            |                        |   | (34,004   | )          |         |   | 4          |            |    |              | 73,767    |         |            |       | (11,342 | )          |         |   | 1            |   |   |            | 205,287   |           |           |   | (45,346  | )       |         |   | 5  |   
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          
|Total temporarily impaired securities          |                                                   | $                           | 1,115,596 |            |                        | $ | (73,481   | )          |         |   | 34         |            |    | $            | 596,030   |         |            | $     | (44,487 | )          |         |   | 7            |   |   | $          | 1,711,626 |           |           | $ | (117,968 | )       |         |   | 41 |   
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          





Disclosure of Contractual Obligations




|                                    |       |                       |           |           |        |   |           |           |           |   |           |           |  |         |         |         |  |   |         |           | 
|----------------------------------- | ----- | --------------------- | --------- | --------- | ------ | - | --------- | --------- | --------- | - | --------- | --------- |  | ------- | ------- | ------- |  | - | ------- | --------- | 
|                                    |       | Payment due by period |          
|                                    |       |                       |          
|                                    |       |                       |           | Less than |        |   |           |           | More than |  
|Contractual Obligations             |       | Total                 |           |           | 1 Year |   |           | 1-3 Years |           |   | 3-5 Years |           |  | 5 Years |        
|                                    |       |                       |           |           |        |   |           |           |           |   |           |           |  |         |        
|Long term debt  principal          |       | $                     | 374,900   |           |        | $ |          |           |           | $ | 40,000    |           |  | $       |        |         |  | $ | 334,900 |          
|Long term debt  interest           |       |                       | 247,451   |           |        |   | 25,017    |           |           |   | 47,037    |           |  |         | 44,041  |         |  |   | 131,356 |          
|Capital leases                      |       |                       |          |           |        |   |          |           |           |   |          |           |  |         |        |         |  |   |        |          
|Operating leases                    |       |                       | 96,682    |           |        |   | 8,338     |           |           |   | 15,415    |           |  |         | 13,063  |         |  |   | 59,866  |          
|Purchase obligations                |       |                       |          |           |        |   |          |           |           |   |          |           |  |         |        |         |  |   |        |          
|Other long-term liabilities         |       |                       |          |           |        |   |          |           |           |   |          |           |  |         |        |         |  |   |        |          
|Losses and loss adjustment expenses |       |                       | 4,228,021 |           |        |   | 1,207,472 |           |           |   | 1,643,278 |           |  |         | 777,506 |         |  |   | 599,765 |          
|                                    |       |                       |           |           |        |   |           |           |           |   |           |           |  |         |        
|                                    | Total |                       | $         | 4,947,054 |        |   | $         | 1,240,827 |           |   | $         | 1,745,730 |  |         | $       | 834,610 |  |   | $       | 1,125,887 | 
|                                    |       |                       |           |           |        |   |           |           |           |   |           |           |  |         |        

60



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|         |                                                               
|-------- | --------------------------------------------------------------
|Item 7A. | Quantitative and Qualitative Disclosures About Market
    Risk



61



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##### 








|        |                                            
|------- | -------------------------------------------
|Item 8. | Financial Statements and Supplementary Data

ODYSSEY RE HOLDINGS CORP.


INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


|                                                                                                                                                                                            |  |      |     | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | --- | 
|                                                                                                                                                                                            |  | Page |    
|                                                                                                                                                                                            |  |      |    
|Report of Independent Registered Public Accounting Firm                                                                                                                                     |  |      | 63  | 
|Consolidated Balance Sheets as of December 31, 2004 and 2003                                                                                                                                |  |      | 65  | 
|Consolidated Statements of Operations and Comprehensive Income
    for the years ended December 31, 2004, 2003 and 2002                                                                     |  |      | 66  | 
|Consolidated Statements of Stockholders Equity for the
    years ended December 31, 2004, 2003 and 2002                                                                                    |  |      | 67  | 
|Consolidated Statements of Cash Flows for the years ended
    December 31, 2004, 2003 and 2002                                                                                              |  |      | 68  | 
|Notes to Consolidated Financial Statements                                                                                                                                                  |  |      | 69  | 
|Schedules:                                                                                                                                                                                  |  |      |     | 
|I.       Summary of
    Investments  Other than Investments in Related
    Parties as of December 31, 2004                                                                                 |  |      | 111 | 
|II.      Condensed Financial Information
    of Registrant as of December 31, 2004 and 2003 and for the
    years ended December 31, 2004, 2003 and 2002                                    |  |      | 112 | 
|III.     Supplementary Insurance Information
    as of December 31, 2004 and 2003 and for the years ended
    December 31, 2004, 2003 and 2002                                              |  |      | 116 | 
|IV.    Reinsurance for the years ended
    December 31, 2004, 2003 and 2002                                                                                                                 |  |      | 117 | 
|VI.    Supplementary Information (for
    Property-Casualty Insurance Underwriters) as of
    December 31, 2004, 2003 and 2002 and for the years ended
    December 31, 2004, 2003 and 2002 |  |      | 118 | 

62



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##### 



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM






Consolidated financial statements and financial statement
schedules






Internal control over financial reporting


Internal Control  Integrated Framework Internal Control 
Integrated Framework




63



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##### 









| |                           
| | --------------------------
| | PricewaterhouseCoopers LLP





64



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##### 



ODYSSEY RE HOLDINGS CORP.


CONSOLIDATED BALANCE SHEETS


|                                                                                           |                                                                                                     |                                                                             |           |           |           |   |           |           |           | 
|------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------- | --------- | --------- | --------- | - | --------- | --------- | --------- | 
|                                                                                           |                                                                                                     | December 31,                                                                |          
|                                                                                           |                                                                                                     |                                                                             |          
|                                                                                           |                                                                                                     | 2004                                                                        |           |           | 2003      |  
|                                                                                           |                                                                                                     |                                                                             |           |           |           |  
|                                                                                           |                                                                                                     | (In thousands,                                                              |          
|                                                                                           |                                                                                                     | except share amounts)                                                       |          
|ASSETS                                                                                    
|Investments and cash:                                                                      |                                                                                                     |                                                                             |           |           |           |   |           |          
|                                                                                           | Fixed income securities, at fair value (amortized cost
    $2,478,614 and $1,605,378, respectively) |                                                                             | $         | 2,505,630 |           |   | $         | 1,597,688 |          
|                                                                                           | Equity securities:                                                                                  |                                                                             |           |           |           |   |           |           |          
|                                                                                           |                                                                                                     | Common stocks, at fair value (cost $736,212 and $376,215,
    respectively) |           |           | 869,871   |   |           |           | 447,700   | 
|                                                                                           |                                                                                                     | Common stocks, at equity                                                    |           |           | 165,507   |   |           |           | 117,489   | 
|                                                                                           | Short-term investments, at cost which approximates fair value                                       |                                                                             |           | 213,403   |           |   |           | 218,208   |          
|                                                                                           | Other invested assets                                                                               |                                                                             |           | 149,075   |           |   |           | 267,504   |          
|                                                                                           | Cash and cash equivalents                                                                           |                                                                             |           | 1,156,447 |           |   |           | 1,588,659 |          
|                                                                                           | Cash collateral for borrowed securities                                                             |                                                                             |           | 176,518   |           |   |           |          |          
|                                                                                           |                                                                                                     |                                                                             |           |           |           |  
|                                                                                           |                                                                                                     | Total investments and cash                                                  |           |           | 5,236,451 |   |           |           | 4,237,248 | 
|Investment income due and accrued                                                          |                                                                                                     |                                                                             | 39,609    |           |           |   | 21,668    |          
|Reinsurance balances receivable                                                            |                                                                                                     |                                                                             | 550,198   |           |           |   | 499,680   |          
|Reinsurance recoverables on loss payments                                                  |                                                                                                     |                                                                             | 89,912    |           |           |   | 83,448    |          
|Reinsurance recoverables on unpaid losses                                                  |                                                                                                     |                                                                             | 1,092,082 |           |           |   | 1,058,623 |          
|Prepaid reinsurance premiums                                                               |                                                                                                     |                                                                             | 93,774    |           |           |   | 110,881   |          
|Funds held by ceding insurers                                                              |                                                                                                     |                                                                             | 192,346   |           |           |   | 124,464   |          
|Deferred acquisition costs                                                                 |                                                                                                     |                                                                             | 171,083   |           |           |   | 168,289   |          
|Federal and foreign income taxes recoverable                                               |                                                                                                     |                                                                             | 102,298   |           |           |   | 71,183    |          
|Other assets                                                                               |                                                                                                     |                                                                             | 138,022   |           |           |   | 84,572    |          
|                                                                                           |                                                                                                     |                                                                             |           |           |           |  
|                                                                                           |                                                                                                     | Total assets                                                                |           | $         | 7,705,775 |   |           | $         | 6,460,056 | 
|                                                                                           |                                                                                                     |                                                                             |           |           |           |  
|                                                                                          
|LIABILITIES                                                                               
|                                                                                          
|Unpaid losses and loss adjustment expenses                                                 |                                                                                                     | $                                                                           | 4,228,021 |           |           | $ | 3,400,277 |          
|Unearned premiums                                                                          |                                                                                                     |                                                                             | 832,305   |           |           |   | 819,840   |          
|Reinsurance balances payable                                                               |                                                                                                     |                                                                             | 122,182   |           |           |   | 121,457   |          
|Funds held under reinsurance contracts                                                     |                                                                                                     |                                                                             | 179,867   |           |           |   | 199,763   |          
|Debt obligations                                                                           |                                                                                                     |                                                                             | 376,040   |           |           |   | 376,892   |          
|Obligation to return borrowed securities                                                   |                                                                                                     |                                                                             | 56,191    |           |           |   |          |          
|Other liabilities                                                                          |                                                                                                     |                                                                             | 325,669   |           |           |   | 151,592   |          
|                                                                                           |                                                                                                     |                                                                             |           |           |           |  
|                                                                                           |                                                                                                     | Total liabilities                                                           |           |           | 6,120,275 |   |           |           | 5,069,821 | 
|                                                                                           |                                                                                                     |                                                                             |           |           |           |  
|                                                                                          
|STOCKHOLDERS EQUITY                                                                      
|                                                                                          
|Preferred stock, $0.01 par value; 200,000,000 shares
    authorized; 0 shares issued       |                                                                                                     |                                                                             |          |           |           |   |          |          
|Common stock, $0.01 par value; 500,000,000 shares
    authorized; 65,142,857 shares issued |                                                                                                     |                                                                             | 651       |           |           |   | 651       |          
|Additional paid-in capital                                                                 |                                                                                                     |                                                                             | 794,055   |           |           |   | 793,586   |          
|Treasury stock, at cost (387,879 and 146,691 shares,
    respectively)                     |                                                                                                     |                                                                             | (9,426    | )         |           |   | (2,549    | )        
|Unearned compensation                                                                      |                                                                                                     |                                                                             | (4,977    | )         |           |   | (3,439    | )        
|Accumulated other comprehensive income, net of deferred income
    taxes                   |                                                                                                     |                                                                             | 136,849   |           |           |   | 112,430   |          
|Retained earnings                                                                          |                                                                                                     |                                                                             | 668,348   |           |           |   | 489,556   |          
|                                                                                           |                                                                                                     |                                                                             |           |           |           |  
|                                                                                           |                                                                                                     | Total stockholders equity                                                  |           |           | 1,585,500 |   |           |           | 1,390,235 | 
|                                                                                           |                                                                                                     |                                                                             |           |           |           |  
|                                                                                           |                                                                                                     | Total liabilities and stockholders equity                                  |           | $         | 7,705,775 |   |           | $         | 6,460,056 | 
|                                                                                           |                                                                                                     |                                                                             |           |           |           |  



65



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ODYSSEY RE HOLDINGS CORP.


CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
INCOME


|                                                                        |                      |                                                                                          |            |           |           |   |            |           |           |   |            |           |           | 
|----------------------------------------------------------------------- | -------------------- | ---------------------------------------------------------------------------------------- | ---------- | --------- | --------- | - | ---------- | --------- | --------- | - | ---------- | --------- | --------- | 
|                                                                        |                      | Years Ended December 31,                                                                 |           
|                                                                        |                      |                                                                                          |           
|                                                                        |                      | 2004                                                                                     |            |           | 2003      |   |            | 2002      |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|                                                                        |                      | (In thousands, except share amounts)                                                     |           
|REVENUES                                                                |                      |                                                                                          |            |           |           |   |            |           |           |   |            |          
|Gross premiums written                                                  |                      | $                                                                                        | 2,656,509  |           |           | $ | 2,558,156  |           |           | $ | 1,894,530  |          
|Ceded premiums written                                                  |                      |                                                                                          | 293,932    |           |           |   | 404,576    |           |           |   | 263,285    |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|                                                                        | Net premiums written |                                                                                          |            | 2,362,577 |           |   |            | 2,153,580 |           |   |            | 1,631,245 |          
|Increase in unearned premiums                                           |                      |                                                                                          | (31,510    | )         |           |   | (188,487   | )         |           |   | (198,603   | )        
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|                                                                        | Net premiums earned  |                                                                                          |            | 2,331,067 |           |   |            | 1,965,093 |           |   |            | 1,432,642 |          
|Net investment income                                                   |                      |                                                                                          | 164,703    |           |           |   | 134,115    |           |           |   | 123,028    |          
|Net realized investment gains                                           |                      |                                                                                          | 113,464    |           |           |   | 202,742    |           |           |   | 135,796    |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|                                                                        |                      | Total revenues                                                                           |            |           | 2,609,234 |   |            |           | 2,301,950 |   |            |           | 1,691,466 | 
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|EXPENSES                                                                |                      |                                                                                          |            |           |           |   |            |           |           |   |            |          
|Losses and loss adjustment expenses                                     |                      |                                                                                          | 1,629,564  |           |           |   | 1,325,765  |           |           |   | 987,195    |          
|Acquisition costs                                                       |                      |                                                                                          | 528,425    |           |           |   | 476,015    |           |           |   | 362,262    |          
|Other underwriting expenses                                             |                      |                                                                                          | 125,679    |           |           |   | 101,308    |           |           |   | 70,269     |          
|Other expense, net                                                      |                      |                                                                                          | 21,207     |           |           |   | 7,912      |           |           |   | 4,985      |          
|Interest expense                                                        |                      |                                                                                          | 25,609     |           |           |   | 12,656     |           |           |   | 8,689      |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|                                                                        |                      | Total expenses                                                                           |            |           | 2,330,484 |   |            |           | 1,923,656 |   |            |           | 1,433,400 | 
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|                                                                        |                      | Income before income taxes and cumulative effect of a change in
    accounting principle |            |           | 278,750   |   |            |           | 378,294   |   |            |           | 258,066   | 
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|Federal and foreign income tax provision (benefit):                     |                      |                                                                                          |            |           |           |   |            |           |           |   |            |          
|                                                                        |                      | Current                                                                                  |            |           | 112,300   |   |            |           | 141,660   |   |            |           | 6,593     | 
|                                                                        |                      | Deferred                                                                                 |            |           | (20,449   | ) |            |           | (12,591   | ) |            |           | 80,158    | 
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|                                                                        |                      | Total federal and foreign income tax provision                                           |            |           | 91,851    |   |            |           | 129,069   |   |            |           | 86,751    | 
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|Income before cumulative effect of a change in accounting
    principle |                      |                                                                                          | 186,899    |           |           |   | 249,225    |           |           |   | 171,315    |          
|Cumulative effect of a change in accounting principle                   |                      |                                                                                          |           |           |           |   |           |           |           |   | 36,862     |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|NET INCOME                                                              |                      | $                                                                                        | 186,899    |           |           | $ | 249,225    |           |           | $ | 208,177    |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|BASIC                                                                   |                      |                                                                                          |            |           |           |   |            |           |           |   |            |          
|Weighted average common shares outstanding                              |                      |                                                                                          | 64,361,535 |           |           |   | 64,736,830 |           |           |   | 64,744,067 |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|Income before cumulative effect of a change in
    accounting principle |                      | $                                                                                        | 2.90       |           |           | $ | 3.85       |           |           | $ | 2.65       |          
|Cumulative effect of a change in accounting principle                   |                      |                                                                                          |           |           |           |   |           |           |           |   | 0.57       |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|Basic earnings per common share                                         |                      |                                                                                          | 2.90       |           |           |   | 3.85       |           |           |   | 3.22       |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|DILUTED                                                                 |                      |                                                                                          |            |           |           |   |            |           |           |   |            |          
|Weighted average common shares outstanding                              |                      |                                                                                          | 69,993,136 |           |           |   | 70,279,467 |           |           |   | 67,919,664 |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|Income before cumulative effect of a change in
    accounting principle |                      | $                                                                                        | 2.71       |           |           | $ | 3.59       |           |           | $ | 2.55       |          
|Cumulative effect of a change in accounting principle                   |                      |                                                                                          |           |           |           |   |           |           |           |   | 0.54       |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|Diluted earnings per common share                                       |                      |                                                                                          | 2.71       |           |           |   | 3.59       |           |           |   | 3.09       |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|DIVIDENDS                                                               |                      |                                                                                          |            |           |           |   |            |           |           |   |            |          
|Dividends declared per common share                                     |                      | $                                                                                        | 0.125      |           |           | $ | 0.106      |           |           | $ | 0.100      |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|COMPREHENSIVE INCOME                                                    |                      |                                                                                          |            |           |           |   |            |           |           |   |            |          
|Net income                                                              |                      | $                                                                                        | 186,899    |           |           | $ | 249,225    |           |           | $ | 208,177    |          
|Other comprehensive income, net of tax                                  |                      |                                                                                          | 24,419     |           |           |   | 90,694     |           |           |   | 34,721     |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          
|Comprehensive income                                                    |                      | $                                                                                        | 211,318    |           |           | $ | 339,919    |           |           | $ | 242,898    |          
|                                                                        |                      |                                                                                          |            |           |           |   |            |           |          



66



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ODYSSEY RE HOLDINGS CORP.


CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY


|                                                                                |  |                                      |            |   |      |   |            |      |  |   |            |  
|------------------------------------------------------------------------------- |  | ------------------------------------ | ---------- | - | ---- | - | ---------- | ---- |  | - | ---------- | -
|                                                                                |  | Years Ended December 31,             |           
|                                                                                |  |                                      |           
|                                                                                |  | 2004                                 |            |   | 2003 |   |            | 2002 | 
|                                                                                |  |                                      |            |   |      |   |            |      | 
|                                                                                |  | (In thousands, except share amounts) |           
|COMMON STOCK                                                                    |  |                                      |            |   |      |   |            |      |  |   |            |  
|Balance, beginning and end of year                                              |  | $                                    | 651        |   |      | $ | 651        |      |  | $ | 651        |  
|                                                                                |  |                                      |            |   |      |   |            |      | 
|ADDITIONAL PAID-IN CAPITAL                                                      |  |                                      |            |   |      |   |            |      |  |   |            |  
|Balance, beginning of year                                                      |  |                                      | 793,586    |   |      |   | 793,334    |      |  |   | 793,334    |  
|Net increase during the year                                                    |  |                                      | 469        |   |      |   | 252        |      |  |   |           |  
|                                                                                |  |                                      |            |   |      |   |            |      | 
|Balance, end of year                                                            |  |                                      | 794,055    |   |      |   | 793,586    |      |  |   | 793,334    |  
|                                                                                |  |                                      |            |   |      |   |            |      | 
|TREASURY STOCK                                                                  |  |                                      |            |   |      |   |            |      |  |   |            |  
|Balance, beginning of year                                                      |  |                                      | (2,549     | ) |      |   | (2,305     | )    |  |   |           |  
|Purchases during the year                                                       |  |                                      | (10,090    | ) |      |   | (331       | )    |  |   | (2,405     | )
|Reissuance during the year                                                      |  |                                      | 3,213      |   |      |   | 87         |      |  |   | 100        |  
|                                                                                |  |                                      |            |   |      |   |            |      | 
|Balance, end of year                                                            |  |                                      | (9,426     | ) |      |   | (2,549     | )    |  |   | (2,305     | )
|                                                                                |  |                                      |            |   |      |   |            |      | 
|UNEARNED COMPENSATION                                                           |  |                                      |            |   |      |   |            |      |  |   |            |  
|Balance, beginning of year                                                      |  |                                      | (3,439     | ) |      |   | (4,572     | )    |  |   | (5,704     | )
|Issuance of restricted stock during the year                                    |  |                                      | (3,314     | ) |      |   |           |      |  |   |           |  
|Amortization during the year                                                    |  |                                      | 1,776      |   |      |   | 1,133      |      |  |   | 1,132      |  
|                                                                                |  |                                      |            |   |      |   |            |      | 
|Balance, end of year                                                            |  |                                      | (4,977     | ) |      |   | (3,439     | )    |  |   | (4,572     | )
|                                                                                |  |                                      |            |   |      |   |            |      | 
|ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS), NET OF
    DEFERRED INCOME TAXES |  |                                      |            |   |      |   |            |      |  |   |            |  
|Balance, beginning of year                                                      |  |                                      | 112,430    |   |      |   | 21,736     |      |  |   | (12,985    | )
|Unrealized net gains on securities, net of reclassification
    adjustments     |  |                                      | 10,656     |   |      |   | 49,818     |      |  |   | 27,565     |  
|Foreign currency translation adjustments                                        |  |                                      | 13,766     |   |      |   | 42,098     |      |  |   | 7,156      |  
|Minimum pension liability                                                       |  |                                      | (3         | ) |      |   | (1,222     | )    |  |   |           |  
|                                                                                |  |                                      |            |   |      |   |            |      | 
|Balance, end of year                                                            |  |                                      | 136,849    |   |      |   | 112,430    |      |  |   | 21,736     |  
|                                                                                |  |                                      |            |   |      |   |            |      | 
|RETAINED EARNINGS                                                               |  |                                      |            |   |      |   |            |      |  |   |            |  
|Balance, beginning of year                                                      |  |                                      | 489,556    |   |      |   | 247,239    |      |  |   | 45,576     |  
|Net income                                                                      |  |                                      | 186,899    |   |      |   | 249,225    |      |  |   | 208,177    |  
|Dividends to stockholders                                                       |  |                                      | (8,107     | ) |      |   | (6,908     | )    |  |   | (6,514     | )
|                                                                                |  |                                      |            |   |      |   |            |      | 
|Balance, end of year                                                            |  |                                      | 668,348    |   |      |   | 489,556    |      |  |   | 247,239    |  
|                                                                                |  |                                      |            |   |      |   |            |      | 
|TOTAL STOCKHOLDERS EQUITY                                                      |  | $                                    | 1,585,500  |   |      | $ | 1,390,235  |      |  | $ | 1,056,083  |  
|                                                                                |  |                                      |            |   |      |   |            |      | 
|COMMON SHARES OUTSTANDING                                                       |  |                                      |            |   |      |   |            |      |  |   |            |  
|Balance, beginning of year                                                      |  |                                      | 64,996,166 |   |      |   | 65,003,963 |      |  |   | 65,142,857 |  
|Net treasury shares acquired                                                    |  |                                      | (241,188   | ) |      |   | (7,797     | )    |  |   | (138,894   | )
|                                                                                |  |                                      |            |   |      |   |            |      | 
|Balance, end of year                                                            |  |                                      | 64,754,978 |   |      |   | 64,996,166 |      |  |   | 65,003,963 |  
|                                                                                |  |                                      |            |   |      |   |            |      | 



67



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##### 



ODYSSEY RE HOLDINGS CORP.


CONSOLIDATED STATEMENTS OF CASH FLOWS


|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |         |   |            |          |         |  
|------------------------------------------------------------------------------------- | ----------------------------------------------------------------------- | --------------------------------------------------- | ---------- | -------- | ---------- | - | ---------- | -------- | ------- | - | ---------- | -------- | ------- | -
|                                                                                      |                                                                         | Years Ended December 31,                            |           
|                                                                                      |                                                                         |                                                     |           
|                                                                                      |                                                                         | 2004                                                |            |          | 2003       |   |            | 2002     |        
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        
|                                                                                      |                                                                         | (In thousands)                                      |           
|OPERATING ACTIVITIES                                                                  |                                                                         |                                                     |            |          |            |   |            |          |         |   |            |         
|Net income                                                                            |                                                                         | $                                                   | 186,899    |          |            | $ | 249,225    |          |         | $ | 208,177    |         
|                                                                                      | Less: cumulative effect of a change in accounting principle             |                                                     |            |         |            |   |            |         |         |   |            | (36,862  | )      
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        
|                                                                                      | Income before cumulative effect of a change in accounting
    principle |                                                     |            | 186,899  |            |   |            | 249,225  |         |   |            | 171,315  |        
|Adjustments to reconcile net income to net cash provided by
    operating activities: |                                                                         |                                                     |            |          |            |   |            |          |         |   |            |         
|                                                                                      | Reinsurance balances and funds held, net                                |                                                     |            | (130,323 | )          |   |            | (109,151 | )       |   |            | (263,666 | )      
|                                                                                      | Unearned premiums                                                       |                                                     |            | 24,081   |            |   |            | 198,923  |         |   |            | 203,898  |        
|                                                                                      | Unpaid losses and loss adjustment expenses                              |                                                     |            | 710,441  |            |   |            | 497,080  |         |   |            | 160,398  |        
|                                                                                      | Federal and foreign income taxes                                        |                                                     |            | (25,291  | )          |   |            | (13,216  | )       |   |            | 91,091   |        
|                                                                                      | Other assets and liabilities, net                                       |                                                     |            | (35,263  | )          |   |            | (6,851   | )       |   |            | 38,160   |        
|                                                                                      | Deferred acquisition costs                                              |                                                     |            | (3,690   | )          |   |            | (38,400  | )       |   |            | (48,764  | )      
|                                                                                      | Net realized investment gains                                           |                                                     |            | (113,464 | )          |   |            | (202,742 | )       |   |            | (135,796 | )      
|                                                                                      | Bond discount accrual, net                                              |                                                     |            | (10,210  | )          |   |            | (10,750  | )       |   |            | (2,425   | )      
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        
|                                                                                      |                                                                         | Net cash provided by operating activities           |            |          | 603,180    |   |            |          | 564,118 |   |            |          | 214,211 |  
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        
|INVESTING ACTIVITIES                                                                  |                                                                         |                                                     |            |          |            |   |            |          |         |   |            |         
|Maturities of fixed income securities                                                 |                                                                         |                                                     | 106,654    |          |            |   | 48,948     |          |         |   | 34,609     |         
|Sales of fixed income securities                                                      |                                                                         |                                                     | 1,437,226  |          |            |   | 4,683,504  |          |         |   | 2,422,938  |         
|Purchases of fixed income securities                                                  |                                                                         |                                                     | (2,304,052 | )        |            |   | (4,103,327 | )        |         |   | (2,264,108 | )       
|Sales of equity securities                                                            |                                                                         |                                                     | 335,954    |          |            |   | 173,085    |          |         |   | 58,967     |         
|Purchases of equity securities                                                        |                                                                         |                                                     | (375,974   | )        |            |   | (355,679   | )        |         |   | (113,233   | )       
|Purchases of other invested assets                                                    |                                                                         |                                                     | (46,400    | )        |            |   | (29,860    | )        |         |   | (88,781    | )       
|Increase related to borrowed securities                                               |                                                                         |                                                     | 39,042     |          |            |   |           |          |         |   |           |         
|Decrease related to borrowed securities                                               |                                                                         |                                                     | (176,518   | )        |            |   |           |          |         |   |           |         
|Increase in short-term investments                                                    |                                                                         |                                                     | (26,046    | )        |            |   | (18,028    | )        |         |   | (155,809   | )       
|Acquisitions and dispositions, net of cash acquired                                   |                                                                         |                                                     | (29,659    | )        |            |   | (39,581    | )        |         |   | 12,133     |         
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        
|                                                                                      |                                                                         | Net cash (used in) provided by investing activities |            |          | (1,039,773 | ) |            |          | 359,062 |   |            |          | (93,284 | )
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        
|FINANCING ACTIVITIES                                                                  |                                                                         |                                                     |            |          |            |   |            |          |         |   |            |         
|Dividends                                                                             |                                                                         |                                                     | (8,107     | )        |            |   | (6,908     | )        |         |   | (6,514     | )       
|Additional borrowings, net of issuance costs                                          |                                                                         |                                                     |           |          |            |   | 222,480    |          |         |   | 107,494    |         
|Repayments of principal                                                               |                                                                         |                                                     | (100       | )        |            |   | (50,000    | )        |         |   | (110,000   | )       
|Sale of interest rate contract                                                        |                                                                         |                                                     |           |          |            |   | 8,667      |          |         |   |           |         
|Purchase of treasury stock                                                            |                                                                         |                                                     | (10,091    | )        |            |   | (284       | )        |         |   | (2,305     | )       
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        
|                                                                                      |                                                                         | Net cash (used in) provided by financing activities |            |          | (18,298    | ) |            |          | 173,955 |   |            |          | (11,325 | )
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        
|Effect of exchange rate changes on cash and cash equivalents                          |                                                                         |                                                     | 22,679     |          |            |   | 6,780      |          |         |   |           |         
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        
|(Decrease) increase in cash and cash equivalents                                      |                                                                         |                                                     | (432,212   | )        |            |   | 1,103,915  |          |         |   | 109,602    |         
|Cash and cash equivalents, beginning of year                                          |                                                                         |                                                     | 1,588,659  |          |            |   | 484,744    |          |         |   | 375,142    |         
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        
|Cash and cash equivalents, end of year                                                |                                                                         | $                                                   | 1,156,447  |          |            | $ | 1,588,659  |          |         | $ | 484,744    |         
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        
|Supplemental disclosures:                                                             |                                                                         |                                                     |            |          |            |   |            |          |         |   |            |         
|                                                                                      | Interest paid                                                           |                                                     | $          | 25,067   |            |   | $          | 9,006    |         |   | $          | 8,664    |        
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        
|                                                                                      | Income taxes paid (recovered)                                           |                                                     | $          | 116,557  |            |   | $          | 142,202  |         |   | $          | (4,327   | )      
|                                                                                      |                                                                         |                                                     |            |          |            |   |            |          |        



68



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




|   |                                      
|-- | -------------------------------------
|1. | Organization and Nature of Operations







|   |                                           
|-- | ------------------------------------------
|2. | Summary of Significant Accounting Policies







| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) The consolidated financial statements include the
    accounts of the Company and its subsidiaries. Intercompany
    transactions have been eliminated.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | (b) All of the Companys investments in fixed income
    securities, which include bonds and notes, and common stocks not
    accounted for under the equity method, are categorized as
    available for sale, and are recorded at their fair
    value based on quoted market prices. Common stocks of affiliates
    are accounted for under the equity method. Short-term
    investments are carried at cost, which approximates fair value.
    Other invested assets include limited partnerships and
    investment funds which are accounted for under the equity
    method. Other invested assets also include benefit plan trust
    accounts which are carried at fair value. The Company considers
    all highly liquid debt instruments purchased with an original
    maturity of three months or less to be cash equivalents.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Unrealized appreciation or depreciation of the Companys
    fixed income and equity securities, net of applicable deferred
    income taxes, is included in accumulated other comprehensive
    income. Unrealized losses that are deemed other than temporary
    are charged to operations. Realized investment gains or losses
    are determined on the basis of average cost. Investment income,
    which is reported net of applicable investment expenses, is
    recorded as earned.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (c) Premiums are earned (net of reinsurance ceded) over the
    terms of the related insurance policies and reinsurance
    contracts or certificates. Unearned premium reserves are
    established for the unexpired portion of insurance policies and
    reinsurance contracts or certificates. Such unearned premium
    reserves are computed by pro rata methods based on statistical
    data or reports received from ceding companies or program
    administrators. Premiums written and earned and related costs
    for which data has not been reported by the ceding company are
    estimated based on historical patterns and statistical and other
    relevant data. Subsequent adjustments, based on actual results,
    are recorded in the period they become known. Premium
    adjustments on deposit contracts and audit premiums are accrued
    on an estimated basis throughout the contract or policy

69



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | term. Premiums written and earned and the change in unearned
    premiums are reported net of reinsurance ceded in the
    consolidated statements of operations. Prepaid reinsurance
    premiums are reported as assets. A reserve for uncollectible
    premiums is established based on historical experience.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| | (d) Acquisition costs, which are reported net of
    acquisition costs ceded, consist principally of commissions and
    brokerage expenses incurred on business written under insurance
    policies and reinsurance contracts or certificates, and are
    deferred and amortized over the period in which the related
    premiums are earned. Commission adjustments are accrued based on
    premiums and losses recorded by the Company. Deferred
    acquisition costs are limited to their estimated realized value,
    which considers anticipated losses and loss adjustment expenses
    and estimated remaining costs of servicing the contracts or
    certificates, all based on historical experience. Realization is
    determined without consideration of investment income.                                                                                                                                                                                                                                                                                                                                                                                                  
|
| | (e) A purchase price in excess of net assets
    (goodwill), arising from a business combination is
    recorded as an asset, and is not amortized. Intangible assets
    with a finite life are amortized over the estimated useful life
    of the asset. Intangible assets with an indefinite useful life
    are not amortized. Goodwill and intangible assets are tested for
    impairment on an annual basis or more frequently if events or
    changes in circumstances indicate that the carrying amount may
    not be recoverable. If the goodwill or intangible asset is
    impaired, it is written down to its realized value with a
    corresponding expense reflected in the consolidated statements
    of operations. Management has determined that the goodwill and
    intangible assets of $37.1 million and $30.7 million,
    reflected in other assets as of December 31, 2004 and 2003,
    respectively, is not impaired. Unamortized deferred credits
    related to net assets acquired in excess of purchase price
    (negative goodwill) arising from a business
    combination are recognized as an extraordinary gain in the
    statement of operations.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Effective January 1, 2002, the Company, in accordance with
    the provisions of SFAS 141, Business
    Combinations and SFAS 142, Goodwill and Other
    Intangible Assets, fully amortized its negative goodwill
    of $36.9 million related to the 1996 acquisition of
    Clearwater and reflected the amortization as a cumulative effect
    of a change in accounting principle in its statement of
    operations for the year ended December 31, 2002. There is
    no effect on the Companys federal and foreign income taxes
    resulting from the amortization of negative goodwill.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (f) The reserve for unpaid losses and loss adjustment
    expenses is based on evaluations by the Companys in-house
    claims department of the reports and individual case estimates
    received from ceding companies for reinsurance business or the
    estimates advised by the Companys outside claims adjusters
    for insurance business. The Companys in-house actuaries
    utilize generally accepted actuarial methodologies to determine
    a reserve for losses incurred but not reported on the basis of
    historical experience and other estimates. The reserves are
    reviewed continually during the year and changes in estimates
    are reflected in losses and loss adjustment expenses in the
    consolidated statements of operations currently. Accordingly,
    losses and loss adjustment expenses, net of reinsurance
    recoverables, are charged to income as incurred. Reinsurance
    recoverables on unpaid losses and loss adjustment expenses are
    reported as assets. A reserve for uncollectible reinsurance
    recoverables is established based on an evaluation of each
    retrocessionaire and historical experience. The Company uses
    tabular reserving for workers compensation liabilities
    that are considered fixed and determinable and discounts such
    reserves using an interest rate of 3.5% and standard mortality
    assumptions.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The reserves for losses and loss adjustment expenses are
    estimates of amounts needed to pay reported and unreported
    claims and related loss adjustment expenses. The estimates are
    based on assumptions related to the ultimate cost to settle such
    claims. The Companys reserves for losses and loss
    adjustment expenses are determined in accordance with sound
    actuarial practices and management believes that such reserves
    are adequate. The inherent uncertainties of estimating reserves
    are greater for reinsurers than for primary insurers, due to the
    diversity of development patterns among different types of
    reinsurance contracts and the necessary reliance on ceding
    companies for information regarding reported claims. As a
    result, there can be

70



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------
| | no assurance that the ultimate liability will not exceed amounts
    reserved with a resulting adverse effect on the Company.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (g) During 2002 and through March 3, 2003, the Company
    and its United States subsidiaries filed a separate consolidated
    tax return. On March 4, 2003, Fairfax increased its
    ownership interest in the Company to approximately 81%. As a
    result, the Company and its United States subsidiaries are
    included in the United States tax group of Fairfax Inc., an
    affiliate that is wholly owned by Fairfax. Inclusion of the
    Company into Fairfax Inc.s tax group did not have an
    effect on the Companys tax position. The federal income
    tax provision is allocated to each of the companies in the
    consolidated group pursuant to a written agreement, on the basis
    of each companys separate return taxable income.



| |                                                                                                                                                                                                                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Deferred federal income taxes are provided for temporary
    differences between the financial statement and tax bases of
    assets and liabilities. Such differences relate principally to
    deferred acquisition costs, unearned premiums, unpaid losses and
    loss adjustment expenses and investments.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (h) All derivative instruments are recognized as either
    assets or liabilities on the balance sheet and measured at their
    fair value. Gains or losses from changes in the derivative
    values are accounted for based on how the derivative is used and
    whether it qualifies for hedge accounting.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (i) The Company has identified its operating segments to
    reflect the manner in which management monitors and evaluates
    the Companys financial performance. The Companys
    operations are comprised of four segments: Americas, EuroAsia,
    London Market and U.S. Insurance.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| | (j) The Company translates the financial statements of its
    foreign subsidiaries to United States dollars by translating
    balance sheet accounts at the balance sheet date exchange rate
    and income statement accounts at the average exchange rate for
    the year. Translation gains or losses are recorded, net of
    deferred income taxes, as a component of comprehensive income.
    Foreign currency transaction gains or losses are reflected in
    the statement of operations in the period they are realized.                                                                                                                                                                                                                                                                                                                                                                                                            
|
| | (k) Basic earnings per share are calculated by dividing net
    income by the weighted average number of common shares
    outstanding, excluding those non-vested shares granted under the
    OdysseyRe Restricted Share Plan. Diluted earnings per share are
    calculated by dividing net income by the weighted average number
    of common shares outstanding, inclusive of: vested and
    non-vested shares, as determined using the treasury stock
    method, granted under the OdysseyRe Restricted Share Plan; stock
    options that would be assumed to be exercised on the balance
    sheet date; and the effect of the conversion of OdysseyRes
    convertible debt to equity securities (see note 8).
    Restricted shares, stock options or the effect of the conversion
    of the convertible debt would not be included in the calculation
    of diluted earnings per share, if the effect would be
    anti-dilutive.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Emerging Issues Task Force (EITF) Issue 4-08
    The Effect of Contingently Convertible Instruments on
    Diluted Earnings Per Share, which is effective for periods
    ending after December 15, 2004, requires that the dilutive
    effect of contingently convertible debt securities, with a
    market price threshold, should be included in diluted earnings
    per share. The terms of OdysseyRes convertible senior
    debentures (see note 17) meet the criteria defined in EITF
    Issue 4-08, and accordingly, the effect of conversion of
    OdysseyRes senior debentures to common stock has been
    assumed when calculating its diluted earnings per share. The
    diluted earnings per share for the years ended December 31,
    2003 and 2002 have been restated to conform to the requirements
    of EITF Issue 4-08.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (l) In April 2002, the Companys stockholders approved
    the Odyssey Re Holdings Corp. 2002 Stock Incentive Plan (the
    2002 Plan). Effective January 1, 2003, the
    Company adopted the expense recognition provisions of Statement
    of Financial Accounting Standards (SFAS) 123,
    Accounting for Stock-Based Compensation, on a
    prospective basis, in accordance with SFAS 148,
    Accounting for Stock-Based Compensation-Transaction and
    Disclosure with respect to the 2002 Plan. The prospective
    method requires

71



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | the application of the fair value based method to compensation
    awards granted, modified, or settled on or after the date of
    adoption. Accordingly, net income for the years ended
    December 31, 2004 and 2003 reflects stock-based
    compensation expense related to stock options granted in 2003
    and subsequently. For stock options granted during 2002, the
    Company accounted for stock-based compensation based on the
    intrinsic-value method prescribed in Accounting Principles Board
    Opinion (APB) 25, Accounting for Stock
    Issued to Employees and related interpretations, as
    permitted under SFAS 123. Had compensation cost been
    charged to earnings in accordance with the fair value based
    method as prescribed in SFAS 123 for all outstanding
    stock-based compensation awards (occurring both before and after
    adoption of the recognition provisions of SFAS 123), the
    Companys net income and net income per share (on a pro
    forma basis) would have been as follows (in thousands, except
    per share amounts):

|                             |                                                                                                                                            |              |                                        |         |              |       |         |              |      |       |         |         |      |       | 
|---------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------ | ------------ | -------------------------------------- | ------- | ------------ | ----- | ------- | ------------ | ---- | ----- | ------- | ------- | ---- | ----- | 
|                             |                                                                                                                                            | Year Ended   |                                        |         | Year Ended   |       |         | Year Ended   |     
|                             |                                                                                                                                            | December 31, |                                        |         | December 31, |       |         | December 31, |     
|                             |                                                                                                                                            | 2004         |                                        |         | 2003         |       |         | 2002         |     
|                             |                                                                                                                                            |              |                                        |         |              |       |         |              |     
|Net income, as reported      |                                                                                                                                            | $            | 186,899                                |         |              | $     | 249,225 |              |      | $     | 208,177 |        
|                             | Add: Stock-based employee compensation expense included in
    reported net income, net of related tax effects                             |              |                                        | 308     |              |       |         | 190          |      |       |         |        |     
|                             | Deduct: Total stock-based compensation expense determined under
    fair value based method for all awards, net of related tax
    effects |              |                                        | (681    | )            |       |         | (564         | )    |       |         | (283    | )   
|                             |                                                                                                                                            |              |                                        |         |              |       |         |              |     
|                             | Pro forma net income, basic earnings per share                                                                                             |              |                                        | 186,526 |              |       |         | 248,851      |      |       |         | 207,894 |     
|                             | Effect of dilutive securities, 4.375% Convertible                                                                                          |              |                                        |         |              |       |         |              |      |       |         |         |     
|                             |                                                                                                                                            |              | Senior Debentures interest, net of tax |         |              | 3,128 |         |              |      | 3,128 |         |         |      | 1,740 | 
|                             |                                                                                                                                            |              |                                        |         |              |       |         |              |     
|                             | Pro forma net income, dilutive earnings per share                                                                                          |              | $                                      | 189,654 |              |       | $       | 251,979      |      |       | $       | 209,634 |     
|                             |                                                                                                                                            |              |                                        |         |              |       |         |              |     
|Net income per common share: |                                                                                                                                            |              |                                        |         |              |       |         |              |      |       |         |        
|                             | As reported:                                                                                                                               |              |                                        |         |              |       |         |              |      |       |         |         |     
|                             |                                                                                                                                            | Basic        |                                        | $       | 2.90         |       |         | $            | 3.85 |       |         | $       | 3.22 |      
|                             |                                                                                                                                            | Diluted      |                                        |         | 2.71         |       |         |              | 3.59 |       |         |         | 3.09 |      
|                             | Pro forma:                                                                                                                                 |              |                                        |         |              |       |         |              |      |       |         |         |     
|                             |                                                                                                                                            | Basic        |                                        | $       | 2.90         |       |         | $            | 3.84 |       |         | $       | 3.21 |      
|                             |                                                                                                                                            | Diluted      |                                        |         | 2.71         |       |         |              | 3.59 |       |         |         | 3.09 |      





72



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (m) Payments of claims by the Company, as reinsurer, to a
    broker on behalf of a reinsured company, are recorded on the
    Companys books as a paid loss at the time the cash is
    disbursed. The payment is treated as a paid claim to the
    reinsured. Premiums due the Company from the reinsured are
    recorded as receivables from the reinsured until the cash is
    received by the Company, either directly from the reinsured or
    from the broker.                                                                                                                                                                                                                                                          
|
| | (n) Funds held under reinsurance treaties is an account
    used to record a liability, in accordance with the contractual
    terms, arising from the Companys receipt of a deposit from
    a reinsurer or the withholding of a portion of the premiums due
    as a guarantee that a reinsurer will meet its loss and other
    obligations. Interest generally accrues on withheld funds in
    accordance with contract terms. Funds held by ceding insurers is
    an account used to record an asset resulting from the ceding
    company, in accordance with the contractual terms, withholding a
    portion of the premium due the Company as a guarantee that the
    Company will meet its loss and other obligations.







|   |                      
|-- | ---------------------
|3. | Business Combinations







73



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|   |            
|-- | -----------
|4. | Investments



|                              |                                                                  |                                    |   |           |              |  |   |              |         |  |            |        |         |  |   |           |           | 
|----------------------------- | ---------------------------------------------------------------- | ---------------------------------- | - | --------- | ------------ |  | - | ------------ | ------- |  | ---------- | ------ | ------- |  | - | --------- | --------- | 
|                              |                                                                  | Cost or                            |   |           | Gross        |  |   | Gross        |         |  |           
|                              |                                                                  | Amortized                          |   |           | Unrealized   |  |   | Unrealized   |         |  |           
|                              |                                                                  | Cost                               |   |           | Appreciation |  |   | Depreciation |         |  | Fair Value |       
|                              |                                                                  |                                    |   |           |              |  |   |              |         |  |            |       
|Fixed income securities:      |                                                                  |                                    |   |           |              |  |   |              |         |  |            |        |         |  |   |          
|Bonds                         |                                                                  |                                    |   |           |              |  |   |              |         |  |            |        |         |  |   |          
|                              | United States government and government agencies and authorities |                                    | $ | 1,400,338 |              |  | $ | 12,711       |         |  | $          | 50,037 |         |  | $ | 1,363,012 |          
|                              | States, municipalities and political subdivisions                |                                    |   | 186,958   |              |  |   | 3,563        |         |  |            | 7,033  |         |  |   | 183,488   |          
|                              | Foreign governments                                              |                                    |   | 336,777   |              |  |   | 7,633        |         |  |            |       |         |  |   | 344,410   |          
|                              | All other corporate                                              |                                    |   | 554,541   |              |  |   | 75,731       |         |  |            | 15,552 |         |  |   | 614,720   |          
|                              |                                                                  |                                    |   |           |              |  |   |              |         |  |            |       
|                              |                                                                  | Total fixed income securities      |   |           | 2,478,614    |  |   |              | 99,638  |  |            |        | 72,622  |  |   |           | 2,505,630 | 
|                              |                                                                  |                                    |   |           |              |  |   |              |         |  |            |       
|Common stocks, at fair value: |                                                                  |                                    |   |           |              |  |   |              |         |  |            |        |         |  |   |          
|                              | Banks, trusts and insurance companies                            |                                    |   | 524,056   |              |  |   | 157,337      |         |  |            | 17,763 |         |  |   | 663,630   |          
|                              | Industrial, miscellaneous and all other                          |                                    |   | 212,156   |              |  |   | 21,668       |         |  |            | 27,583 |         |  |   | 206,241   |          
|                              |                                                                  |                                    |   |           |              |  |   |              |         |  |            |       
|                              |                                                                  | Total common stocks, at fair value |   |           | 736,212      |  |   |              | 179,005 |  |            |        | 45,346  |  |   |           | 869,871   | 
|                              |                                                                  |                                    |   |           |              |  |   |              |         |  |            |       
|Short-term investments:       |                                                                  |                                    |   |           |              |  |   |              |         |  |            |        |         |  |   |          
|                              | United States government                                         |                                    |   | 6,072     |              |  |   |             |         |  |            |       |         |  |   | 6,072     |          
|                              | All other                                                        |                                    |   | 207,331   |              |  |   |             |         |  |            |       |         |  |   | 207,331   |          
|                              |                                                                  |                                    |   |           |              |  |   |              |         |  |            |       
|                              |                                                                  | Total short-term investments       |   |           | 213,403      |  |   |              |        |  |            |        |        |  |   |           | 213,403   | 
|                              |                                                                  |                                    |   |           |              |  |   |              |         |  |            |       
|                              |                                                                  | Total                              |   | $         | 3,428,229    |  |   | $            | 278,643 |  |            | $      | 117,968 |  |   | $         | 3,588,904 | 
|                              |                                                                  |                                    |   |           |              |  |   |              |         |  |            |       



74



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                              |                                                                  |                                    |   |         |              |  |   |              |         |  |            |        |        |  |   |         |           | 
|----------------------------- | ---------------------------------------------------------------- | ---------------------------------- | - | ------- | ------------ |  | - | ------------ | ------- |  | ---------- | ------ | ------ |  | - | ------- | --------- | 
|                              |                                                                  | Cost or                            |   |         | Gross        |  |   | Gross        |         |  |           
|                              |                                                                  | Amortized                          |   |         | Unrealized   |  |   | Unrealized   |         |  |           
|                              |                                                                  | Cost                               |   |         | Appreciation |  |   | Depreciation |         |  | Fair Value |       
|                              |                                                                  |                                    |   |         |              |  |   |              |         |  |            |       
|Fixed income securities:      |                                                                  |                                    |   |         |              |  |   |              |         |  |            |        |        |  |   |        
|Bonds                         |                                                                  |                                    |   |         |              |  |   |              |         |  |            |        |        |  |   |        
|                              | United States government and government agencies and authorities |                                    | $ | 894,397 |              |  | $ | 2,050        |         |  | $          | 44,926 |        |  | $ | 851,521 |          
|                              | States, municipalities and political subdivisions                |                                    |   | 205,747 |              |  |   | 4,954        |         |  |            | 1,637  |        |  |   | 209,064 |          
|                              | Foreign governments                                              |                                    |   | 79,447  |              |  |   | 3,642        |         |  |            | 797    |        |  |   | 82,292  |          
|                              | Public utilities                                                 |                                    |   | 37,959  |              |  |   | 1,270        |         |  |            |       |        |  |   | 39,229  |          
|                              | All other corporate                                              |                                    |   | 387,828 |              |  |   | 29,895       |         |  |            | 2,141  |        |  |   | 415,582 |          
|                              |                                                                  |                                    |   |         |              |  |   |              |         |  |            |       
|                              |                                                                  | Total fixed income securities      |   |         | 1,605,378    |  |   |              | 41,811  |  |            |        | 49,501 |  |   |         | 1,597,688 | 
|                              |                                                                  |                                    |   |         |              |  |   |              |         |  |            |       
|Common stocks, at fair value: |                                                                  |                                    |   |         |              |  |   |              |         |  |            |        |        |  |   |        
|                              | Banks, trusts and insurance companies                            |                                    |   | 167,436 |              |  |   | 41,013       |         |  |            | 6,234  |        |  |   | 202,215 |          
|                              | Industrial, miscellaneous and all other                          |                                    |   | 208,779 |              |  |   | 36,712       |         |  |            | 6      |        |  |   | 245,485 |          
|                              |                                                                  |                                    |   |         |              |  |   |              |         |  |            |       
|                              |                                                                  | Total common stocks, at fair value |   |         | 376,215      |  |   |              | 77,725  |  |            |        | 6,240  |  |   |         | 447,700   | 
|                              |                                                                  |                                    |   |         |              |  |   |              |         |  |            |       
|Short-term investments:       |                                                                  |                                    |   |         |              |  |   |              |         |  |            |        |        |  |   |        
|                              | United States government                                         |                                    |   | 21,092  |              |  |   |             |         |  |            |       |        |  |   | 21,092  |          
|                              | All other                                                        |                                    |   | 197,116 |              |  |   |             |         |  |            |       |        |  |   | 197,116 |          
|                              |                                                                  |                                    |   |         |              |  |   |              |         |  |            |       
|                              |                                                                  | Total short-term investments       |   |         | 218,208      |  |   |              |        |  |            |        |       |  |   |         | 218,208   | 
|                              |                                                                  |                                    |   |         |              |  |   |              |         |  |            |       
|                              |                                                                  | Total                              |   | $       | 2,199,801    |  |   | $            | 119,536 |  |            | $      | 55,741 |  |   | $       | 2,263,596 | 
|                              |                                                                  |                                    |   |         |              |  |   |              |         |  |            |       







|                                       |  |           |           |  |            |   |           | 
|-------------------------------------- |  | --------- | --------- |  | ---------- | - | --------- | 
|                                       |  | Amortized |           |  |           
|                                       |  | Cost      |           |  | Fair Value |  
|                                       |  |           |           |  |            |  
|Due in one year or less                |  | $         | 68,478    |  |            | $ | 70,706    | 
|Due after one year through five years  |  |           | 228,106   |  |            |   | 237,252   | 
|Due after five years through ten years |  |           | 141,833   |  |            |   | 136,987   | 
|Due after ten years                    |  |           | 2,040,197 |  |            |   | 2,060,685 | 
|                                       |  |           |           |  |            |  
|Total fixed income securities          |  | $         | 2,478,614 |  |            | $ | 2,505,630 | 
|                                       |  |           |           |  |            |  



75



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|                                                        |                         |      |         |         |      |   |        |         |  |   |         |         | 
|------------------------------------------------------- | ----------------------- | ---- | ------- | ------- | ---- | - | ------ | ------- |  | - | ------- | ------- | 
|                                                        |                         | 2004 |         |         | 2003 |   |        | 2002    | 
|                                                        |                         |      |         |         |      |   |        |         | 
|Interest on fixed income securities and preferred stock |                         | $    | 123,822 |         |      | $ | 91,971 |         |  | $ | 120,905 |        
|Dividends on common stocks, fair value                  |                         |      | 23,736  |         |      |   | 6,753  |         |  |   | 4,503   |        
|Net income of common stocks, at equity                  |                         |      | 7,979   |         |      |   | 10,407 |         |  |   | 11,792  |        
|Interest on cash and short-term investments             |                         |      | 19,668  |         |      |   | 16,048 |         |  |   | 6,427   |        
|Other                                                   |                         |      | 21,432  |         |      |   | 45,061 |         |  |   | 10,091  |        
|                                                        |                         |      |         |         |      |   |        |         | 
|                                                        | Gross investment income |      |         | 196,637 |      |   |        | 170,240 |  |   |         | 153,718 | 
|Investment expenses                                     |                         |      | 11,819  |         |      |   | 9,476  |         |  |   | 6,610   |        
|Interest on funds held under reinsurance contracts      |                         |      | 20,115  |         |      |   | 26,649 |         |  |   | 24,080  |        
|                                                        |                         |      |         |         |      |   |        |         | 
|                                                        | Net investment income   |      | $       | 164,703 |      |   | $      | 134,115 |  |   | $       | 123,028 | 
|                                                        |                         |      |         |         |      |   |        |         | 



76



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                               |        |      |   |         |         |   |   |         |         |  |   |         |         |  
|------------------------------ | ------ | ---- | - | ------- | ------- | - | - | ------- | ------- |  | - | ------- | ------- | -
|                               |        | 2004 |   |         | 2003    |   |   | 2002    |        
|                               |        |      |   |         |         |   |   |         |        
|Fixed income securities:       |        |      |   |         |         |   |   |         |         |  |   |        
|                               | Gains  |      | $ | 55,899  |         |   | $ | 226,399 |         |  | $ | 156,419 |        
|                               | Losses |      |   | 2,352   |         |   |   | 64,521  |         |  |   | 15,330  |        
|                               |        |      |   |         |         |   |   |         |        
|                               |        | Net  |   |         | 53,547  |   |   |         | 161,878 |  |   |         | 141,089 |  
|                               |        |      |   |         |         |   |   |         |        
|Preferred stock:               |        |      |   |         |         |   |   |         |         |  |   |        
|                               | Gains  |      |   |        |         |   |   | 967     |         |  |   | 2,369   |        
|                               | Losses |      |   |        |         |   |   |        |         |  |   |        |        
|                               |        |      |   |         |         |   |   |         |        
|                               |        | Net  |   |         |        |   |   |         | 967     |  |   |         | 2,369   |  
|                               |        |      |   |         |         |   |   |         |        
|Equity securities:             |        |      |   |         |         |   |   |         |         |  |   |        
|                               | Gains  |      |   | 95,436  |         |   |   | 42,934  |         |  |   | 5,506   |        
|                               | Losses |      |   | 2,425   |         |   |   | 7,189   |         |  |   | 13,470  |        
|                               |        |      |   |         |         |   |   |         |        
|                               |        | Net  |   |         | 93,011  |   |   |         | 35,745  |  |   |         | (7,964  | )
|                               |        |      |   |         |         |   |   |         |        
|Other securities:              |        |      |   |         |         |   |   |         |         |  |   |        
|                               | Gains  |      |   | 30,117  |         |   |   | 11,435  |         |  |   | 6,663   |        
|                               | Losses |      |   | 63,211  |         |   |   | 7,283   |         |  |   | 6,361   |        
|                               |        |      |   |         |         |   |   |         |        
|                               |        | Net  |   |         | (33,094 | ) |   |         | 4,152   |  |   |         | 302     |  
|                               |        |      |   |         |         |   |   |         |        
|Total realized gains (losses): |        |      |   |         |         |   |   |         |         |  |   |        
|                               | Gains  |      |   | 181,452 |         |   |   | 281,735 |         |  |   | 170,957 |        
|                               | Losses |      |   | 67,988  |         |   |   | 78,993  |         |  |   | 35,161  |        
|                               |        |      |   |         |         |   |   |         |        
|                               |        | Net  |   | $       | 113,464 |   |   | $       | 202,742 |  |   | $       | 135,796 |  
|                               |        |      |   |         |         |   |   |         |        





|                                    |          |                                                          |         |        |        |   |         |        |        |   |         |        |        | 
|----------------------------------- | -------- | -------------------------------------------------------- | ------- | ------ | ------ | - | ------- | ------ | ------ | - | ------- | ------ | ------ | 
|                                    |          | 2004                                                     |         |        | 2003   |   |         | 2002   |       
|                                    |          |                                                          |         |        |        |   |         |        |       
|Fixed income securities             |          | $                                                        | 34,706  |        |        | $ | (35,506 | )      |        | $ | 29,618  |       
|Redeemable preferred stock          |          |                                                          |        |        |        |   | 704     |        |        |   | (704    | )     
|Equity securities                   |          |                                                          | 22,063  |        |        |   | 69,213  |        |        |   | 12,554  |       
|Other invested assets               |          |                                                          | (40,376 | )      |        |   | 42,232  |        |        |   | 940     |       
|                                    |          |                                                          |         |        |        |   |         |        |       
|                                    | Subtotal |                                                          |         | 16,393 |        |   |         | 76,643 |        |   |         | 42,408 |       
|Provision for deferred income taxes |          |                                                          | (5,737  | )      |        |   | (26,825 | )      |        |   | (14,843 | )     
|                                    |          |                                                          |         |        |        |   |         |        |       
|                                    |          | Net change in unrealized net appreciation of investments |         | $      | 10,656 |   |         | $      | 49,818 |   |         | $      | 27,565 | 
|                                    |          |                                                          |         |        |        |   |         |        |       

77



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)








|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |           |           |           |   |          |         |         |   |    |    |    | 
|---------------------------------------------- | ------------------------------------------------- | --------------------------- | --------- | ---------- | ---------------------- | - | --------- | ---------- | ------- | - | ---------- | ---------- | -- | ------------ | --------- | ------- | ---------- | ----- | ------- | ---------- | ------- | - | ------------ | - | - | ---------- | --------- | --------- | --------- | - | -------- | ------- | ------- | - | -- | -- | -- | 
|                                               |                                                   | Duration of Unrealized Loss |           |            |                        |   |           |            |        
|                                               |                                                   |                             |           |            |                        |   |           |            |        
|                                               |                                                   | Less than 12 Months         |           |            | Greater than 12 Months |   |           | Total      |        
|                                               |                                                   |                             |           |            |                        |   |           |            |        
|                                               |                                                   |                             |           | Gross      |                        |   |           |            |         |   | Gross      |            |    |              |           |         |            | Gross |         |            |        
|                                               |                                                   |                             |           | Unrealized |                        |   | Number of |            |         |   |            | Unrealized |    |              | Number of |         |            |       |         | Unrealized |         |   | Number of    |  
|                                               |                                                   | Fair Value                  |           |            | Depreciation           |   |           | Securities |         |   | Fair Value |            |    | Depreciation |           |         | Securities |       |         | Fair Value |         |   | Depreciation |   |   | Securities |          
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          
|Fixed income securities investment grade:      |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |           |           |           |   |          |         |         |   |    |   
|                                               | United States government agencies and authorities |                             | $         | 667,309    |                        |   | $         | (17,214    | )       |   |            | 16         |    |              | $         | 511,952 |            |       | $       | (32,822    | )       |   |              | 4 |   |            | $         | 1,179,261 |           |   | $        | (50,036 | )       |   |    | 20 |   
|                                               | States, municipalities and political subdivisions |                             |           | 25,995     |                        |   |           | (358       | )       |   |            | 5          |    |              |           | 10,311  |            |       |         | (323       | )       |   |              | 2 |   |            |           | 36,306    |           |   |          | (681    | )       |   |    | 7  |   
|                                               | All other corporate                               |                             |           | 172,495    |                        |   |           | (1,501     | )       |   |            | 2          |    |              |           |        |            |       |         |           |         |   |              |  |   |            |           | 172,495   |           |   |          | (1,501  | )       |   |    | 2  |   
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          
|                                               |                                                   | Total investment grade      |           |            | 865,799                |   |           |            | (19,073 | ) |            |            | 23 |              |           |         | 522,263    |       |         |            | (33,145 | ) |              |   | 6 |            |           |           | 1,388,062 |   |          |         | (52,218 | ) |    |    | 29 | 
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          
|Fixed income securities non- investment grade: |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |           |           |           |   |          |         |         |   |    |   
|                                               | States, municipalities and political subdivisions |                             |           | 4,010      |                        |   |           | (6,352     | )       |   |            | 1          |    |              |           |        |            |       |         |           |         |   |              |  |   |            |           | 4,010     |           |   |          | (6,352  | )       |   |    | 1  |   
|                                               | All other corporate                               |                             |           | 114,267    |                        |   |           | (14,052    | )       |   |            | 6          |    |              |           |        |            |       |         |           |         |   |              |  |   |            |           | 114,267   |           |   |          | (14,052 | )       |   |    | 6  |   
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          
|                                               |                                                   | Total non-investment grade  |           |            | 118,277                |   |           |            | (20,404 | ) |            |            | 7  |              |           |         |           |       |         |            |        |   |              |   |  |            |           |           | 118,277   |   |          |         | (20,404 | ) |    |    | 7  | 
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          
|                                               |                                                   | Total fixed income          |           |            | 984,076                |   |           |            | (39,477 | ) |            |            | 30 |              |           |         | 522,263    |       |         |            | (33,145 | ) |              |   | 6 |            |           |           | 1,506,339 |   |          |         | (72,622 | ) |    |    | 36 | 
|Common stocks, at fair value                   |                                                   |                             | 131,520   |            |                        |   | (34,004   | )          |         |   | 4          |            |    |              | 73,767    |         |            |       | (11,342 | )          |         |   | 1            |   |   |            | 205,287   |           |           |   | (45,346  | )       |         |   | 5  |   
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          
|Total temporarily impaired securities          |                                                   | $                           | 1,115,596 |            |                        | $ | (73,481   | )          |         |   | 34         |            |    | $            | 596,030   |         |            | $     | (44,487 | )          |         |   | 7            |   |   | $          | 1,711,626 |           |           | $ | (117,968 | )       |         |   | 41 |   
|                                               |                                                   |                             |           |            |                        |   |           |            |         |   |            |            |    |              |           |         |            |       |         |            |         |   |              |   |   |            |          



78



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NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


















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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)
















|   |              
|-- | -------------
|5. | Retrocessions



80



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                 |  |        |         |  |         |   |           |       |  |   |         |  |  |   |           | 
|---------------- |  | ------ | ------- |  | ------- | - | --------- | ----- |  | - | ------- |  |  | - | --------- | 
|                 |  | 2004   |        
|                 |  |        |        
|                 |  | Direct |         |  | Assumed |   |           | Ceded |  |   | Net     | 
|                 |  |        |         |  |         |   |           |       |  |   |         | 
|Premiums written |  | $      | 702,127 |  |         | $ | 1,954,382 |       |  | $ | 293,932 |  |  | $ | 2,362,577 | 
|Premiums earned  |  |        | 697,998 |  |         |   | 1,938,895 |       |  |   | 305,826 |  |  |   | 2,331,067 | 

|                 |  |        |         |  |         |   |           |       |  |   |         |  |  |   |           | 
|---------------- |  | ------ | ------- |  | ------- | - | --------- | ----- |  | - | ------- |  |  | - | --------- | 
|                 |  | 2003   |        
|                 |  |        |        
|                 |  | Direct |         |  | Assumed |   |           | Ceded |  |   | Net     | 
|                 |  |        |         |  |         |   |           |       |  |   |         | 
|Premiums written |  | $      | 634,860 |  |         | $ | 1,923,296 |       |  | $ | 404,576 |  |  | $ | 2,153,580 | 
|Premiums earned  |  |        | 557,726 |  |         |   | 1,796,324 |       |  |   | 388,957 |  |  |   | 1,965,093 | 

|                 |  |        |         |  |         |   |           |       |  |   |         |  |  |   |           | 
|---------------- |  | ------ | ------- |  | ------- | - | --------- | ----- |  | - | ------- |  |  | - | --------- | 
|                 |  | 2002   |        
|                 |  |        |        
|                 |  | Direct |         |  | Assumed |   |           | Ceded |  |   | Net     | 
|                 |  |        |         |  |         |   |           |       |  |   |         | 
|Premiums written |  | $      | 296,855 |  |         | $ | 1,597,675 |       |  | $ | 263,285 |  |  | $ | 1,631,245 | 
|Premiums earned  |  |        | 171,602 |  |         |   | 1,469,176 |       |  |   | 208,136 |  |  |   | 1,432,642 | 









81



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)










|                                    |  |      |         |   |      |   |         |      |  |   |         |  
|----------------------------------- |  | ---- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | -
|                                    |  | 2004 |         |   | 2003 |   |         | 2002 | 
|                                    |  |      |         |   |      |   |         |      | 
|Earned premium                      |  | $    | (6,603  | ) |      | $ | (76,705 | )    |  | $ | (26,200 | )
|Acquisition costs                   |  |      | 600     |   |      |   | 27,087  |      |  |   | 9,258   |  
|Losses and loss adjustment expenses |  |      | 5,108   |   |      |   | 100,359 |      |  |   | 33,399  |  
|                                    |  |      |         |   |      |   |         |      | 
|Net underwriting (loss) income      |  |      | (895    | ) |      |   | 50,741  |      |  |   | 16,457  |  
|Interest expense                    |  |      | (20,081 | ) |      |   | (24,850 | )    |  |   | (22,650 | )
|                                    |  |      |         |   |      |   |         |      | 
|(Loss) income before income taxes   |  | $    | (20,976 | ) |      | $ | 25,891  |      |  | $ | (6,193  | )
|                                    |  |      |         |   |      |   |         |      | 



82



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                           
|-- | --------------------------
|6. | Related Party Transactions



|                                           |  |      |         |  |      |   |         |      |  |   |         | 
|------------------------------------------ |  | ---- | ------- |  | ---- | - | ------- | ---- |  | - | ------- | 
|                                           |  | 2004 |         |  | 2003 |   |         | 2002 | 
|                                           |  |      |         |  |      |   |         |      | 
|Assumed:                                   |  |      |         |  |      |   |         |      |  |   |         | 
|Premiums written                           |  | $    | 138,805 |  |      | $ | 287,199 |      |  | $ | 127,535 | 
|Premiums earned                            |  |      | 199,924 |  |      |   | 238,439 |      |  |   | 106,972 | 
|Losses and loss adjustment expenses        |  |      | 137,500 |  |      |   | 115,504 |      |  |   | 47,989  | 
|Acquisition costs                          |  |      | 44,027  |  |      |   | 66,640  |      |  |   | 34,359  | 
|Reinsurance payable on loss payments       |  |      | 5,752   |  |      |   | 6,501   |      |  |   | 7,762   | 
|Reinsurance balances receivable            |  |      | 21,005  |  |      |   | 44,686  |      |  |   | 11,997  | 
|Unpaid losses and loss adjustment expenses |  |      | 295,903 |  |      |   | 230,806 |      |  |   | 183,562 | 
|Unearned premiums                          |  |      | 20,874  |  |      |   | 81,993  |      |  |   | 33,233  | 
|Ceded:                                     |  |      |         |  |      |   |         |      |  |   |         | 
|Premiums written                           |  |      | 28,773  |  |      |   | 62,058  |      |  |   | 37,034  | 
|Premiums earned                            |  |      | 35,257  |  |      |   | 58,252  |      |  |   | 32,497  | 
|Losses and loss adjustment expenses        |  |      | 41,165  |  |      |   | 44,977  |      |  |   | 29,296  | 
|Acquisition costs                          |  |      | 4,908   |  |      |   | 15,800  |      |  |   | 4,193   | 
|Ceded reinsurance balances payable         |  |      | 9,044   |  |      |   | 6,800   |      |  |   | 5,517   | 
|Reinsurance recoverables on loss payments  |  |      | 1,481   |  |      |   | 820     |      |  |   | 1,679   | 
|Reinsurance recoverables on unpaid losses  |  |      | 217,929 |  |      |   | 189,115 |      |  |   | 159,740 | 
|Prepaid reinsurance premiums               |  |      | 2,929   |  |      |   | 9,414   |      |  |   | 5,608   | 





83



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)








|   |                                              
|-- | ---------------------------------------------
|7. | Accumulated Other Comprehensive Income (Loss)



|                                                                       |  |      |         |   |      |   |         |      |  |   |         |  
|---------------------------------------------------------------------- |  | ---- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | -
|                                                                       |  | 2004 |         |   | 2003 |   |         | 2002 | 
|                                                                       |  |      |         |   |      |   |         |      | 
|Beginning balance of accumulated other comprehensive
    income (loss) |  | $    | 112,430 |   |      | $ | 21,736  |      |  | $ | (12,985 | )
|                                                                       |  |      |         |   |      |   |         |      | 
|                                                                      
|Beginning balance of unrealized net gains (losses) on securities       |  |      | 73,756  |   |      |   | 23,938  |      |  |   | (3,627  | )
|Ending balance of unrealized net gains on securities                   |  |      | 84,412  |   |      |   | 73,756  |      |  |   | 23,938  |  
|                                                                       |  |      |         |   |      |   |         |      | 
|Current period change in unrealized net gains on securities            |  |      | 10,656  |   |      |   | 49,818  |      |  |   | 27,565  |  
|                                                                       |  |      |         |   |      |   |         |      | 
|                                                                      
|Beginning balance of foreign currency translation adjustments          |  |      | 39,896  |   |      |   | (2,202  | )    |  |   | (9,358  | )
|Ending balance of foreign currency translation adjustments             |  |      | 53,662  |   |      |   | 39,896  |      |  |   | (2,202  | )
|                                                                       |  |      |         |   |      |   |         |      | 
|Current period change in foreign currency translation adjustments      |  |      | 13,766  |   |      |   | 42,098  |      |  |   | 7,156   |  
|                                                                       |  |      |         |   |      |   |         |      | 
|                                                                      
|Beginning balance of minimum pension liability                         |  |      | (1,222  | ) |      |   |        |      |  |   |        |  
|Ending balance of minimum pension liability                            |  |      | (1,225  | ) |      |   | (1,222  | )    |  |   |        |  
|                                                                       |  |      |         |   |      |   |         |      | 
|Current period change of minimum pension liability                     |  |      | (3      | ) |      |   | (1,222  | )    |  |   |        |  
|                                                                       |  |      |         |   |      |   |         |      | 
|                                                                      
|Current period change in accumulated other comprehensive income        |  |      | 24,419  |   |      |   | 90,694  |      |  |   | 34,721  |  
|                                                                       |  |      |         |   |      |   |         |      | 
|Ending balance of accumulated other comprehensive income               |  | $    | 136,849 |   |      | $ | 112,430 |      |  | $ | 21,736  |  
|                                                                       |  |      |         |   |      |   |         |      | 

84



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                                                          |  |      |         |   |      |   |         |      |  |   |         |  
|------------------------------------------------------------------------- |  | ---- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | -
|                                                                          |  | 2004 |         |   | 2003 |   |         | 2002 | 
|                                                                          |  |      |         |   |      |   |         |      | 
|Net income                                                                |  | $    | 186,899 |   |      | $ | 249,225 |      |  | $ | 208,177 |  
|                                                                          |  |      |         |   |      |   |         |      | 
|Other comprehensive income, before tax:                                   |  |      |         |   |      |   |         |      |  |   |         |  
|Unrealized net gains on securities arising during the period              |  |      | 75,872  |   |      |   | 97,883  |      |  |   | 62,687  |  
|Reclassification adjustment for realized gains included in net
    income |  |      | (59,478 | ) |      |   | (21,239 | )    |  |   | (20,279 | )
|Foreign currency translation adjustments                                  |  |      | 21,178  |   |      |   | 64,766  |      |  |   | 11,009  |  
|Minimum pension liability                                                 |  |      | (5      | ) |      |   | (1,880  | )    |  |   |        |  
|                                                                          |  |      |         |   |      |   |         |      | 
|Other comprehensive income, before tax                                    |  |      | 37,567  |   |      |   | 139,530 |      |  |   | 53,417  |  
|                                                                          |  |      |         |   |      |   |         |      | 
|                                                                         
|Tax (expense) benefit:                                                    |  |      |         |   |      |   |         |      |  |   |         |  
|Unrealized net gains on securities arising during the period              |  |      | (26,555 | ) |      |   | (34,260 | )    |  |   | (21,941 | )
|Reclassification adjustment for realized gains included in net
    income |  |      | 20,817  |   |      |   | 7,434   |      |  |   | 7,098   |  
|Foreign currency translation adjustments                                  |  |      | (7,412  | ) |      |   | (22,668 | )    |  |   | (3,853  | )
|Minimum pension liability                                                 |  |      | 2       |   |      |   | 658     |      |  |   |        |  
|                                                                          |  |      |         |   |      |   |         |      | 
|Total tax expense                                                         |  |      | (13,148 | ) |      |   | (48,836 | )    |  |   | (18,696 | )
|                                                                          |  |      |         |   |      |   |         |      | 
|Other comprehensive income, net of tax                                    |  |      | 24,419  |   |      |   | 90,694  |      |  |   | 34,721  |  
|                                                                          |  |      |         |   |      |   |         |      | 
|Comprehensive income                                                      |  | $    | 211,318 |   |      | $ | 339,919 |      |  | $ | 242,898 |  
|                                                                          |  |      |         |   |      |   |         |      | 

85



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                   
|-- | ------------------
|8. | Earnings Per Share



|                                                                                            |          |                                                                         |            |   |      |   |            |      |      |   |            |   |      | 
|------------------------------------------------------------------------------------------- | -------- | ----------------------------------------------------------------------- | ---------- | - | ---- | - | ---------- | ---- | ---- | - | ---------- | - | ---- | 
|                                                                                            |          | 2004                                                                    |            |   | 2003 |   |            | 2002 |     
|                                                                                            |          |                                                                         |            |   |      |   |            |      |     
|Income before cumulative effect of a change in accounting
    principle                     |          | $                                                                       | 186,899    |   |      | $ | 249,225    |      |      | $ | 171,315    |  
|Cumulative effect of a change in accounting principle                                       |          |                                                                         |           |   |      |   |           |      |      |   | 36,862     |  
|                                                                                            |          |                                                                         |            |   |      |   |            |      |     
|Basic Earnings per Common Share                                                             |          |                                                                         |            |   |      |   |            |      |      |   |            |  
|Net income available to stockholders                                                        |          |                                                                         | 186,899    |   |      |   | 249,225    |      |      |   | 208,177    |  
|Effect of Dilutive Securities 4.375% Convertible Senior
    Debentures interest, net of tax |          |                                                                         | 3,128      |   |      |   | 3,128      |      |      |   | 1,740      |  
|                                                                                            |          |                                                                         |            |   |      |   |            |      |     
|Diluted Earnings per Common Share                                                           |          |                                                                         |            |   |      |   |            |      |      |   |            |  
|Income available to common stockholders and assumed conversions                             |          | $                                                                       | 190,027    |   |      | $ | 252,353    |      |      | $ | 209,917    |  
|                                                                                            |          |                                                                         |            |   |      |   |            |      |     
|                                                                                           
|Weighted average common shares outstanding  basic                                          |          |                                                                         | 64,361,535 |   |      |   | 64,736,830 |      |      |   | 64,744,067 |  
|                                                                                            |          |                                                                         |            |   |      |   |            |      |     
|Effect of dilutive shares:                                                                  |          |                                                                         |            |   |      |   |            |      |      |   |            |  
|4.375% Convertible Senior Debentures                                                        |          |                                                                         | 5,168,405  |   |      |   | 5,169,175  |      |      |   | 2,789,938  |  
|Stock options                                                                               |          |                                                                         | 167,620    |   |      |   | 50,649     |      |      |   |           |  
|Incremental value of restricted stock                                                       |          |                                                                         | 295,576    |   |      |   | 322,813    |      |      |   | 385,659    |  
|                                                                                            |          |                                                                         |            |   |      |   |            |      |     
|Total effect of dilutive shares                                                             |          |                                                                         | 5,631,601  |   |      |   | 5,542,637  |      |      |   | 3,175,597  |  
|                                                                                            |          |                                                                         |            |   |      |   |            |      |     
|                                                                                           
|Weighted average common shares outstanding  dilutive                                       |          |                                                                         | 69,993,136 |   |      |   | 70,279,467 |      |      |   | 67,919,664 |  
|                                                                                            |          |                                                                         |            |   |      |   |            |      |     
|                                                                                           
|Earnings per common share:                                                                  |          |                                                                         |            |   |      |   |            |      |      |   |            |  
|                                                                                            | Basic:   |                                                                         |            |   |      |   |            |      |      |   |            |   |     
|                                                                                            |          | Income before cumulative effect of a change in accounting
    principle |            | $ | 2.90 |   |            | $    | 3.85 |   |            | $ | 2.65 | 
|                                                                                            |          | Cumulative effect of a change in accounting principle                   |            |   |     |   |            |      |     |   |            |   | 0.57 | 
|                                                                                            |          |                                                                         |            |   |      |   |            |      |     
|                                                                                            |          | Basic earnings per common share                                         |            | $ | 2.90 |   |            | $    | 3.85 |   |            | $ | 3.22 | 
|                                                                                            |          |                                                                         |            |   |      |   |            |      |     
|                                                                                            | Diluted: |                                                                         |            |   |      |   |            |      |      |   |            |   |     
|                                                                                            |          | Income before cumulative effect of a change in accounting
    principle |            | $ | 2.71 |   |            | $    | 3.59 |   |            | $ | 2.55 | 
|                                                                                            |          | Cumulative effect of a change in accounting principle                   |            |   |     |   |            |      |     |   |            |   | 0.54 | 
|                                                                                            |          |                                                                         |            |   |      |   |            |      |     
|Diluted earnings per common share                                                           |          | $                                                                       | 2.71       |   |      | $ | 3.59       |      |      | $ | 3.09       |  
|                                                                                            |          |                                                                         |            |   |      |   |            |      |     

86



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                  
|-- | -----------------
|9. | Employee Benefits









|                                        |                                                |                                   |        |        |        |   |        |        |        | 
|--------------------------------------- | ---------------------------------------------- | --------------------------------- | ------ | ------ | ------ | - | ------ | ------ | ------ | 
|                                        |                                                | 2004                              |        |        | 2003   |  
|                                        |                                                |                                   |        |        |        |  
|Change in projected benefit obligation: |                                                |                                   |        |        |        |   |        |       
|                                        | Benefit obligation at beginning of year        |                                   | $      | 35,471 |        |   | $      | 29,537 |       
|                                        | Service cost                                   |                                   |        | 2,210  |        |   |        | 1,754  |       
|                                        | Interest cost                                  |                                   |        | 2,105  |        |   |        | 1,897  |       
|                                        | Actuarial loss                                 |                                   |        | 3,493  |        |   |        | 3,124  |       
|                                        | Benefits paid                                  |                                   |        | (1,265 | )      |   |        | (841   | )     
|                                        | Other                                          |                                   |        | 440    |        |   |        |       |       
|                                        |                                                |                                   |        |        |        |  
|                                        |                                                | Benefit obligation at end of year |        | $      | 42,454 |   |        | $      | 35,471 | 
|                                        |                                                |                                   |        |        |        |  
|Change in Plan assets:                  |                                                |                                   |        |        |        |   |        |       
|                                        | Fair value of Plan assets at beginning of year |                                   | $      | 27,549 |        |   | $      | 25,301 |       
|                                        | Actual return on Plan assets                   |                                   |        | 1,028  |        |   |        | 839    |       
|                                        | Actual contributions during the year           |                                   |        | 13,743 |        |   |        | 2,250  |       
|                                        | Benefits paid                                  |                                   |        | (1,265 | )      |   |        | (841   | )     
|                                        |                                                |                                   |        |        |        |  
|                                        | Fair value of Plan assets at end of year       |                                   | $      | 41,055 |        |   | $      | 27,549 |       
|                                        |                                                |                                   |        |        |        |  
|                                        | Fair value of Plan assets consists of:         |                                   |        |        |        |   |        |        |       
|                                        |                                                | Fixed income securities           |        | $      | 34,784 |   |        | $      | 26,799 | 
|                                        |                                                | Other                             |        |        | 6,271  |   |        |        | 750    | 
|                                        |                                                |                                   |        |        |        |  
|Total                                   |                                                | $                                 | 41,055 |        |        | $ | 27,549 |       
|                                        |                                                |                                   |        |        |        |  
|Unfunded status                         |                                                | $                                 | (1,399 | )      |        | $ | (7,922 | )     
|Unrecognized prior service cost         |                                                |                                   | 557    |        |        |   | 127    |       
|Unrecognized net loss                   |                                                |                                   | 4,691  |        |        |   | 581    |       
|                                        |                                                |                                   |        |        |        |  
|Prepaid (accrued) pension cost          |                                                | $                                 | 3,849  |        |        | $ | (7,214 | )     
|                                        |                                                |                                   |        |        |        |  



|                                                 |  |      |       |  |      |  |       | 
|------------------------------------------------ |  | ---- | ----- |  | ---- |  | ----- | 
|                                                 |  | 2004 |       |  | 2003 | 
|                                                 |  |      |       |  |      | 
|Discount rate                                    |  |      | 5.75% |  |      |  | 6.00% | 
|Rate of compensation increase                    |  |      | 5.76% |  |      |  | 5.69% | 
|Expected long term rate of return on Plan assets |  |      | 5.75% |  |      |  | 6.00% | 

87



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                              |  |      |       |  |      |  |       | 
|----------------------------- |  | ---- | ----- |  | ---- |  | ----- | 
|                              |  | 2004 |       |  | 2003 | 
|                              |  |      |       |  |      | 
|Discount rate                 |  |      | 5.75% |  |      |  | 6.00% | 
|Rate of compensation increase |  |      | 5.76% |  |      |  | 5.69% | 



|                              |                  |      |        |       |      |   |        |       |  |   |        |     | 
|----------------------------- | ---------------- | ---- | ------ | ----- | ---- | - | ------ | ----- |  | - | ------ | --- | 
|                              |                  | 2004 |        |       | 2003 |   |        | 2002  | 
|                              |                  |      |        |       |      |   |        |       | 
|Service cost                  |                  | $    | 2,210  |       |      | $ | 1,754  |       |  | $ | 1,328  |    
|Interest cost                 |                  |      | 2,105  |       |      |   | 1,897  |       |  |   | 1,652  |    
|Return on assets              |                  |      | (1,645 | )     |      |   | (1,622 | )     |  |   | (1,621 | )  
|Net amortization and deferral |                  |      | 10     |       |      |   | (32    | )     |  |   | (449   | )  
|                              |                  |      |        |       |      |   |        |       | 
|                              | Net pension cost |      | $      | 2,680 |      |   | $      | 1,997 |  |   | $      | 910 | 
|                              |                  |      |        |       |      |   |        |       | 





|            |  |        |        | 
|----------- |  | ------ | ------ | 
|Year        |  | Amount |       
|            |  |        |       
|2005        |  | $      | 1,750  | 
|2006        |  |        | 2,260  | 
|2007        |  |        | 1,200  | 
|2008        |  |        | 3,320  | 
|2009        |  |        | 2,330  | 
|2010 - 2014 |  |        | 23,520 | 





88



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                        |                                                |                                          |   |         |        |   |   |         |        |  
|--------------------------------------- | ---------------------------------------------- | ---------------------------------------- | - | ------- | ------ | - | - | ------- | ------ | -
|                                        |                                                | 2004                                     |   |         | 2003   |  
|                                        |                                                |                                          |   |         |        |  
|Change in projected benefit obligation: |                                                |                                          |   |         |        |   |   |        
|                                        | Benefit obligation at beginning of year        |                                          | $ | 12,668  |        |   | $ | 10,330  |       
|                                        | Service cost                                   |                                          |   | 700     |        |   |   | 544     |       
|                                        | Interest cost                                  |                                          |   | 740     |        |   |   | 708     |       
|                                        | Actuarial loss                                 |                                          |   | 960     |        |   |   | 1,669   |       
|                                        | Benefits paid                                  |                                          |   | (667    | )      |   |   | (664    | )     
|                                        | Other                                          |                                          |   |        |        |   |   | 81      |       
|                                        |                                                |                                          |   |         |        |  
|                                        |                                                | Benefit obligation at end of year        |   | $       | 14,401 |   |   | $       | 12,668 |  
|                                        |                                                |                                          |   |         |        |  
|Change in plan assets:                  |                                                |                                          |   |         |        |   |   |        
|                                        | Fair value of plan assets at beginning of year |                                          | $ |        |        |   | $ |        |       
|                                        | Actual contributions during the year           |                                          |   | 667     |        |   |   | 664     |       
|                                        | Benefits paid                                  |                                          |   | (667    | )      |   |   | (664    | )     
|                                        |                                                |                                          |   |         |        |  
|                                        |                                                | Fair value of plan assets at end of year |   | $       |       |   |   | $       |       |  
|                                        |                                                |                                          |   |         |        |  
|                                        | Unfunded status                                |                                          | $ | (14,401 | )      |   | $ | (12,668 | )     
|                                        | Unrecognized transition obligation             |                                          |   | 142     |        |   |   | 211     |       
|                                        | Unrecognized net actuarial loss                |                                          |   | 5,015   |        |   |   | 4,262   |       
|                                        | Unrecognized prior service cost                |                                          |   | (486    | )      |   |   | (522    | )     
|                                        |                                                |                                          |   |         |        |  
|                                        |                                                | Accrued pension cost                     |   | $       | (9,730 | ) |   | $       | (8,717 | )
|                                        |                                                |                                          |   |         |        |  



|                              |  |      |       |  |      |  |       | 
|----------------------------- |  | ---- | ----- |  | ---- |  | ----- | 
|                              |  | 2004 |       |  | 2003 | 
|                              |  |      |       |  |      | 
|Average discount rate         |  |      | 6.00% |  |      |  | 6.50% | 
|Rate of compensation increase |  |      | 6.00% |  |      |  | 6.00% | 



|                              |  |      |       |  |      |  |       | 
|----------------------------- |  | ---- | ----- |  | ---- |  | ----- | 
|                              |  | 2004 |       |  | 2003 | 
|                              |  |      |       |  |      | 
|Discount rate                 |  |      | 5.75% |  |      |  | 6.00% | 
|Rate of compensation increase |  |      | 5.76% |  |      |  | 6.00% | 



|                              |                  |      |     |       |      |   |     |       |  |   |     |       | 
|----------------------------- | ---------------- | ---- | --- | ----- | ---- | - | --- | ----- |  | - | --- | ----- | 
|                              |                  | 2004 |     |       | 2003 |   |     | 2002  | 
|                              |                  |      |     |       |      |   |     |       | 
|Service cost                  |                  | $    | 700 |       |      | $ | 544 |       |  | $ | 450 |      
|Interest cost                 |                  |      | 740 |       |      |   | 708 |       |  |   | 637 |      
|Recognized net actuarial loss |                  |      | 208 |       |      |   | 165 |       |  |   | 55  |      
|Recognized prior service cost |                  |      | (37 | )     |      |   | (37 | )     |  |   | (37 | )    
|Other                         |                  |      | 69  |       |      |   | 150 |       |  |   | 146 |      
|                              |                  |      |     |       |      |   |     |       | 
|                              | Net pension cost |      | $   | 1,680 |      |   | $   | 1,530 |  |   | $   | 1,251 | 
|                              |                  |      |     |       |      |   |     |       | 



89



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|            |  |        |       | 
|----------- |  | ------ | ----- | 
|Year        |  | Amount |      
|            |  |        |      
|2005        |  | $      | 943   | 
|2006        |  |        | 689   | 
|2007        |  |        | 690   | 
|2008        |  |        | 689   | 
|2009        |  |        | 902   | 
|2010 - 2014 |  |        | 5,673 | 











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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                        |                                         |                                   |   |        |        |   |   |        |        |  
|--------------------------------------- | --------------------------------------- | --------------------------------- | - | ------ | ------ | - | - | ------ | ------ | -
|                                        |                                         | 2004                              |   |        | 2003   |  
|                                        |                                         |                                   |   |        |        |  
|Change in projected benefit obligation: |                                         |                                   |   |        |        |   |   |       
|                                        | Benefit obligation at beginning of year |                                   | $ | 8,304  |        |   | $ | 5,485  |       
|                                        | Service cost                            |                                   |   | 1,061  |        |   |   | 543    |       
|                                        | Interest cost                           |                                   |   | 447    |        |   |   | 374    |       
|                                        | Actuarial loss                          |                                   |   | 253    |        |   |   | 2,074  |       
|                                        | Benefits paid                           |                                   |   | (201   | )      |   |   | (179   | )     
|                                        | Plan change                             |                                   |   | (1,352 | )      |   |   |       |       
|                                        | Other                                   |                                   |   | 7      |        |   |   | 7      |       
|                                        |                                         |                                   |   |        |        |  
|                                        |                                         | Benefit obligation at end of year |   | $      | 8,519  |   |   | $      | 8,304  |  
|                                        |                                         |                                   |   |        |        |  
|                                        | Unfunded status                         |                                   | $ | (8,519 | )      |   | $ | (8,304 | )     
|                                        | Unrecognized prior service cost         |                                   |   | (651   | )      |   |   | 54     |       
|                                        | Unrecognized net loss                   |                                   |   | 361    |        |   |   | 110    |       
|                                        |                                         |                                   |   |        |        |  
|                                        |                                         | Accrued benefit cost              |   | $      | (8,809 | ) |   | $      | (8,140 | )
|                                        |                                         |                                   |   |        |        |  



|                              |  |      |       |  |      |  |       | 
|----------------------------- |  | ---- | ----- |  | ---- |  | ----- | 
|                              |  | 2004 |       |  | 2003 | 
|                              |  |      |       |  |      | 
|Discount rate                 |  |      | 6.00% |  |      |  | 6.75% | 
|Rate of compensation increase |  |      | 6.00% |  |      |  | 6.00% | 



|                              |  |      |       |  |      |  |       | 
|----------------------------- |  | ---- | ----- |  | ---- |  | ----- | 
|                              |  | 2004 |       |  | 2003 | 
|                              |  |      |       |  |      | 
|Discount rate                 |  |      | 5.75% |  |      |  | 6.00% | 
|Rate of compensation increase |  |      | 6.00% |  |      |  | 6.00% | 



|                              |          |      |       |     |      |   |     |      |  |   |     |     | 
|----------------------------- | -------- | ---- | ----- | --- | ---- | - | --- | ---- |  | - | --- | --- | 
|                              |          | 2004 |       |     | 2003 |   |     | 2002 | 
|                              |          |      |       |     |      |   |     |      | 
|Service cost                  |          | $    | 1,061 |     |      | $ | 543 |      |  | $ | 370 |    
|Interest cost                 |          |      | 447   |     |      |   | 374 |      |  |   | 325 |    
|Curtailment credit            |          |      | (582  | )   |      |   |    |      |  |   |    |    
|Net amortization and deferral |          |      | (63   | )   |      |   | 28  |      |  |   | (17 | )  
|                              |          |      |       |     |      |   |     |      | 
|                              | Net cost |      | $     | 863 |      |   | $   | 945  |  |   | $   | 678 | 
|                              |          |      |       |     |      |   |     |      | 



91



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|          |  |        |     | 
|--------- |  | ------ | --- | 
|Year      |  | Amount |    
|          |  |        |    
|2005      |  | $      | 237 | 
|2006      |  |        | 257 | 
|2007      |  |        | 303 | 
|2008      |  |        | 356 | 
|2009      |  |        | 381 | 
|2010-2014 |  | 3,048  |    







|    |                               
|--- | ------------------------------
|10. | Stock Based Compensation Plans



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NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                                               |  |           |         |          |                |   |       |           |          |  |                |   |  |   |       | 
|-------------------------------------------------------------- |  | --------- | ------- | -------- | -------------- | - | ----- | --------- | -------- |  | -------------- | - |  | - | ----- | 
|                                                               |  | 2004      |         |          | 2003           |  
|                                                               |  |           |         |          |                |  
|                                                               |  |           |         | Weighted |                |   |       |           | Weighted | 
|                                                               |  | Number    |         |          | Average        |   |       | Number    |          |  | Average        |  
|                                                               |  | of Shares |         |          | Exercise Price |   |       | of Shares |          |  | Exercise Price |  
|                                                               |  |           |         |          |                |   |       |           |          |  |                |  
|Outstanding, beginning of year                                 |  |           | 774,437 |          |                | $ | 18.70 |           |          |  | 446,750        |   |  | $ | 18.00 | 
|Granted                                                        |  |           |        |          |                |   |      |           |          |  | 338,000        |   |  |   | 19.61 | 
|Exercised                                                      |  |           | (22,063 | )        |                | $ | 18.32 |           |          |  | (2,063         | ) |  |   | 18.00 | 
|Forfeited                                                      |  |           | (14,085 | )        |                | $ | 18.76 |           |          |  | (8,250         | ) |  |   | 18.40 | 
|                                                               |  |           |         |          |                |   |       |           |          |  |                |  
|Outstanding, end of year                                       |  |           | 738,289 |          |                | $ | 18.71 |           |          |  | 774,437        |   |  | $ | 18.70 | 
|                                                               |  |           |         |          |                |   |       |           |          |  |                |  
|Exercisable, end of year                                       |  |           | 286,539 |          |                | $ | 18.44 |           |          |  | 113,359        |   |  | $ | 18.00 | 
|                                                               |  |           |         |          |                |   |       |           |          |  |                |  
|Weighted average fair value of options granted during the year |  |           |         |          |                | $ |      |           |          |  |                |   |  | $ | 5.42  | 
|                                                               |  |           |         |          |                |   |       |           |          |  |                |  





|                    |  |           |                     |  |           |          |  |  |                   |           |  |          |  |  |  |  |  | 
|------------------- |  | --------- | ------------------- |  | --------- | -------- |  |  | ----------------- | --------- |  | -------- |  |  |  |  |  | 
|Options Outstanding |  |           | Options Exercisable | 
|                    |  |           |                     | 
|                    |  | Weighted- |                     |  | Weighted- |          |  |  |                   | Weighted- | 
|Number              |  |           | Average             |  |           | Average  |  |  | Number            |           |  | Average  | 
|Outstanding at      |  |           | Remaining           |  |           | Exercise |  |  | Exercisable at    |           |  | Exercise | 
|December 31, 2004   |  |           | Life                |  |           | Price    |  |  | December 31, 2004 |           |  | Price    | 
|                    |  |           |                     |  |           |          |  |  |                   |           |  |          | 
|2,250               |  |           | 8.17                |  |           | $17.40   |  |  |                  |           |  | $       |  | 
|427,039             |  |           | 7.27                |  |           | 18.00    |  |  | 211,289           |           |  | 18.00    |  | 
|1,875               |  |           | 8.00                |  |           | 18.35    |  |  | 625               |           |  | 18.35    | 
|10,000              |  |           | 8.50                |  |           | 19.58    |  |  | 2,500             |           |  | 19.58    | 
|287,125             |  |           | 8.42                |  |           | 19.65    |  |  | 69,625            |           |  | 19.65    | 
|5,000               |  |           | 8.42                |  |           | 20.90    |  |  | 1,250             |           |  | 20.90    | 
|5,000               |  |           | 8.33                |  |           | 21.77    |  |  | 1,250             |           |  | 21.77    | 
|                    |  |           |                     |  |           |          |  |  |                   |           |  |          | 
|738,289             |  |           | 7.75                |  |           | $18.71   |  |  | 286,539           |           |  | $18.44   | 
|                    |  |           |                     |  |           |          |  |  |                   |           |  |          | 





93



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)










|    |                                 
|--- | --------------------------------
|11. | Federal and Foreign Income Taxes





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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                               |               |                                               |        |         |         |   |         |         |         |   |        |        |        | 
|---------------------------------------------- | ------------- | --------------------------------------------- | ------ | ------- | ------- | - | ------- | ------- | ------- | - | ------ | ------ | ------ | 
|                                               |               | 2004                                          |        |         | 2003    |   |         | 2002    |        
|                                               |               |                                               |        |         |         |   |         |         |        
|Current:                                       |               |                                               |        |         |         |   |         |         |         |   |        |       
|                                               | United States |                                               | $      | 108,467 |         |   | $       | 141,660 |         |   | $      | 6,593  |       
|                                               | Foreign       |                                               |        | 3,833   |         |   |         |        |         |   |        |       |       
|                                               |               |                                               |        |         |         |   |         |         |        
|                                               |               | Total current income tax provision            |        |         | 112,300 |   |         |         | 141,660 |   |        |        | 6,593  | 
|                                               |               |                                               |        |         |         |   |         |         |        
|Deferred:                                      |               |                                               |        |         |         |   |         |         |         |   |        |       
|                                               | United States |                                               |        | (20,449 | )       |   |         | (12,591 | )       |   |        | 80,158 |       
|                                               | Foreign       |                                               |        |        |         |   |         |        |         |   |        |       |       
|                                               |               |                                               |        |         |         |   |         |         |        
|                                               |               | Total deferred income tax (benefit) provision |        |         | (20,449 | ) |         |         | (12,591 | ) |        |        | 80,158 | 
|                                               |               |                                               |        |         |         |   |         |         |        
|Total federal and foreign income tax provision |               | $                                             | 91,851 |         |         | $ | 129,069 |         |         | $ | 86,751 |       
|                                               |               |                                               |        |         |         |   |         |         |        



|                                                                |                                |      |         |         |      |   |         |         | 
|--------------------------------------------------------------- | ------------------------------ | ---- | ------- | ------- | ---- | - | ------- | ------- | 
|                                                                |                                | 2004 |         |         | 2003 |  
|                                                                |                                |      |         |         |      |  
|Unpaid losses and loss adjustment expenses                      |                                | $    | 148,786 |         |      | $ | 99,431  |        
|Unearned premiums                                               |                                |      | 45,066  |         |      |   | 41,342  |        
|Reserve for potentially uncollectible balances                  |                                |      | 12,465  |         |      |   | 12,465  |        
|Pension and benefit accruals                                    |                                |      | 6,999   |         |      |   | 6,813   |        
|Investments                                                     |                                |      | 24,267  |         |      |   | 34,216  |        
|                                                                |                                |      |         |         |      |  
|                                                                | Total deferred tax assets      |      |         | 237,583 |      |   |         | 194,267 | 
|                                                                |                                |      |         |         |      |  
|Deferred acquisition costs                                      |                                |      | 60,059  |         |      |   | 58,901  |        
|Other                                                           |                                |      | 6,005   |         |      |   | 2,902   |        
|                                                                |                                |      |         |         |      |  
|                                                                | Total deferred tax liabilities |      |         | 66,064  |      |   |         | 61,803  | 
|                                                                |                                |      |         |         |      |  
|                                                                | Net deferred tax assets        |      |         | 171,519 |      |   |         | 132,464 | 
|Deferred income taxes on accumulated other comprehensive income |                                |      | (73,687 | )       |      |   | (60,538 | )      
|                                                                |                                |      |         |         |      |  
|Deferred federal and foreign income tax asset                   |                                |      | 97,832  |         |      |   | 71,926  |        
|Current taxes recoverable (payable)                             |                                |      | 4,466   |         |      |   | (743    | )      
|                                                                |                                |      |         |         |      |  
|Federal and foreign income taxes recoverable                    |                                | $    | 102,298 |         |      | $ | 71,183  |        
|                                                                |                                |      |         |         |      |  



95



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                                                                         |  |        |         |         |        |  |      |        |         |   |         |   |  |         |      |   |        |   |         |   |  |  |      |  
|---------------------------------------------------------------------------------------- |  | ------ | ------- | ------- | ------ |  | ---- | ------ | ------- | - | ------- | - |  | ------- | ---- | - | ------ | - | ------- | - |  |  | ---- | -
|                                                                                         |  | 2004   |         |         | 2003   |  |      | 2002   |        
|                                                                                         |  |        |         |         |        |  |      |        |        
|                                                                                         |  |        |         | % of    |        |  |      |        | % of    |   |         |   |  | % of    |     
|                                                                                         |  |        |         | Pre-tax |        |  |      |        | Pre-tax |   |         |   |  | Pre-tax |     
|                                                                                         |  | Amount |         |         | Income |  |      | Amount |         |   | Income  |   |  | Amount  |      |   | Income |  
|                                                                                         |  |        |         |         |        |  |      |        |         |   |         |   |  |         |      |   |        |  
|Income before income taxes and cumulative effect of a change in
    accounting principle |  | $      | 278,750 |         |        |  |      |        |         | $ | 378,294 |   |  |         |      |   |        | $ | 258,066 |   |  |  |      |  
|                                                                                         |  |        |         |         |        |  |      |        |         |   |         |   |  |         |      |   |        |  
|Income taxes computed on pre-tax income                                                  |  | $      | 97,562  |         |        |  | 35.0 | %      |         | $ | 132,403 |   |  |         | 35.0 | % |        | $ | 90,323  |   |  |  | 35.0 | %
|Increase (decrease) in income taxes resulting from:                                      |  |        |         |         |        |  |      |        |         |   |         |   |  |         |      |   |        |   |         |   |  |  |      |  
|Dividend received deduction and tax-exempt income                                        |  |        | (4,875  | )       |        |  | (1.7 | )      |         |   | (3,790  | ) |  |         | (1.0 | ) |        |   | (1,923  | ) |  |  | (0.8 | )
|Other, net                                                                               |  |        | (836    | )       |        |  | (0.3 | )      |         |   | 456     |   |  |         | 0.1  |   |        |   | (1,649  | ) |  |  | (0.6 | )
|                                                                                         |  |        |         |         |        |  |      |        |         |   |         |   |  |         |      |   |        |  
|Total federal and foreign income tax provision                                           |  | $      | 91,851  |         |        |  | 33.0 | %      |         | $ | 129,069 |   |  |         | 34.1 | % |        | $ | 86,751  |   |  |  | 33.6 | %
|                                                                                         |  |        |         |         |        |  |      |        |         |   |         |   |  |         |      |   |        |  





|    |                              
|--- | -----------------------------
|12. | Commitments and Contingencies



|                    |       |   |        |        | 
|------------------- | ----- | - | ------ | ------ | 
|2005                |       | $ | 8,338  |       
|2006                |       |   | 8,025  |       
|2007                |       |   | 7,390  |       
|2008                |       |   | 6,671  |       
|2009                |       |   | 6,392  |       
|2010 and thereafter |       |   | 59,866 |       
|                    |       |   |       
|                    | Total |   | $      | 96,682 | 
|                    |       |   |       







96



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)












97



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)














98



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)








|    |                                                         
|--- | --------------------------------------------------------
|13. | Dividend Restrictions, Statutory Information and Capital







|                       |  |             |           |  |      |   |           |      |  |   |         | 
|---------------------- |  | ----------- | --------- |  | ---- | - | --------- | ---- |  | - | ------- | 
|                       |  | 2004        |           |  | 2003 |   |           | 2002 | 
|                       |  |             |           |  |      |   |           |      | 
|                       |  | (Unaudited) |           |  |      |   |          
|Net income             |  | $           | 114,174   |  |      | $ | 110,471   |      |  | $ | 173,960 | 
|Policyholders surplus |  | $           | 1,675,858 |  |      | $ | 1,553,067 |      |  | $ | 990,469 | 





99



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|    |                               
|--- | ------------------------------
|14. | Financial Guaranty Reinsurance





|                       |                              |      |     |    |      |   |     |    | 
|---------------------- | ---------------------------- | ---- | --- | -- | ---- | - | --- | -- | 
|                       |                              | 2004 |     |    | 2003 |  
|                       |                              |      |     |    |      |  
|Municipal obligations: |                              |      |     |    |      |   |     |   
|                       | General obligation bonds     |      | $   | 18 |      |   | $   | 21 | 
|                       | Special revenue bonds        |      |     | 34 |      |   |     | 49 | 
|                       | Industrial development bonds |      |     | 1  |      |   |     | 1  | 
|Corporate obligations  |                              |      | 3   |    |      |   | 4   |   
|                       |                              |      |     |    |      |  
|                       | Total                        |      | $   | 56 |      |   | $   | 75 | 
|                       |                              |      |     |    |      |  
|Unearned premiums      |                              | $    | 0.3 |    |      | $ | 0.6 |   
|                       |                              |      |     |    |      |  



|                                               |          |      |              |      | 
|---------------------------------------------- | -------- | ---- | ------------ | ---- | 
|                                               |          | 2004 |             
|State                                          |          |      | Debt Service |     
|                                               |          |      |              |     
|Florida                                        |          | $    | 10.2         |     
|Arizona                                        |          |      | 4.3          |     
|California                                     |          |      | 4.2          |     
|New Jersey                                     |          |      | 3.3          |     
|Kentucky                                       |          |      | 2.8          |     
|New York                                       |          |      | 2.8          |     
|Illinois                                       |          |      | 2.5          |     
|Alabama                                        |          |      | 2.4          |     
|Louisiana                                      |          |      | 2.2          |     
|                                               |          |      |             
|                                               | Subtotal |      |              | 34.7 | 
|States less than $2 million exposure per state |          |      | 12.0         |     
|Geographic information not available           |          |      | 9.0          |     
|                                               |          |      |             
|                                               | Total    |      | $            | 55.7 | 
|                                               |          |      |             

100



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ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|    |                                           
|--- | ------------------------------------------
|15. | Unpaid Losses and Loss Adjustment Expenses



|                                                                                  |              |      |           |           |      |   |           |           |  |   |           |         | 
|--------------------------------------------------------------------------------- | ------------ | ---- | --------- | --------- | ---- | - | --------- | --------- |  | - | --------- | ------- | 
|                                                                                  |              | 2004 |           |           | 2003 |   |           | 2002      | 
|                                                                                  |              |      |           |           |      |   |           |           | 
|Gross unpaid losses and loss adjustment expenses, beginning of
    year           |              | $    | 3,400,277 |           |      | $ | 2,871,552 |           |  | $ | 2,720,220 |        
|Less ceded unpaid losses and loss adjustment expenses, beginning
    of year      |              |      | 1,058,623 |           |      |   | 1,026,979 |           |  |   | 1,045,791 |        
|                                                                                  |              |      |           |           |      |   |           |           | 
|Net unpaid losses and loss adjustment expenses, beginning of year                 |              |      | 2,341,654 |           |      |   | 1,844,573 |           |  |   | 1,674,429 |        
|                                                                                  |              |      |           |           |      |   |           |           | 
|Acquisition and disposition of net unpaid losses and loss
    adjustment expenses |              |      | 77,074    |           |      |   |          |           |  |   | 9,151     |        
|                                                                                  |              |      |           |           |      |   |           |           | 
|Losses and loss adjustment expenses incurred related to:                          |              |      |           |           |      |   |           |           |  |   |           |        
|                                                                                  | Current year |      |           | 1,448,360 |      |   |           | 1,208,854 |  |   |           | 921,222 | 
|                                                                                  | Prior years  |      |           | 181,204   |      |   |           | 116,911   |  |   |           | 65,973  | 
|                                                                                  |              |      |           |           |      |   |           |           | 
|Total losses and loss adjustment expenses incurred                                |              |      | 1,629,564 |           |      |   | 1,325,765 |           |  |   | 987,195   |        
|                                                                                  |              |      |           |           |      |   |           |           | 
|Paid losses and loss adjustment expenses related to:                              |              |      |           |           |      |   |           |           |  |   |           |        
|                                                                                  | Current year |      |           | 304,892   |      |   |           | 241,590   |  |   |           | 215,073 | 
|                                                                                  | Prior years  |      |           | 632,373   |      |   |           | 601,777   |  |   |           | 616,179 | 
|                                                                                  |              |      |           |           |      |   |           |           | 
|Total paid losses and loss adjustment expenses                                    |              |      | 937,265   |           |      |   | 843,367   |           |  |   | 831,252   |        
|                                                                                  |              |      |           |           |      |   |           |           | 
|Effects of exchange rate changes                                                  |              |      | 24,912    |           |      |   | 14,683    |           |  |   | 5,050     |        
|                                                                                  |              |      |           |           |      |   |           |           | 
|Net unpaid losses and loss adjustment expenses, end of year                       |              |      | 3,135,939 |           |      |   | 2,341,654 |           |  |   | 1,844,573 |        
|Add ceded unpaid losses and loss adjustment expenses, end of year                 |              |      | 1,092,082 |           |      |   | 1,058,623 |           |  |   | 1,026,979 |        
|                                                                                  |              |      |           |           |      |   |           |           | 
|Gross unpaid losses and loss adjustment expenses, end of year                     |              | $    | 4,228,021 |           |      | $ | 3,400,277 |           |  | $ | 2,871,552 |        
|                                                                                  |              |      |           |           |      |   |           |           | 







101



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)








|    |                                                                   
|--- | ------------------------------------------------------------------
|16. | Asbestos and Environmental Losses and Loss Adjustment
    Expenses











102



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                                                             |  |      |         |   |      |   |         |      |  |   |         | 
|---------------------------------------------------------------------------- |  | ---- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | 
|                                                                             |  | 2004 |         |   | 2003 |   |         | 2002 | 
|                                                                             |  |      |         |   |      |   |         |      | 
|Asbestos                                                                     |  |      |         |   |      |   |         |      |  |   |         | 
|Gross unpaid losses and loss adjustment expenses,
    beginning of year      |  | $    | 215,662 |   |      | $ | 189,720 |      |  | $ | 193,753 | 
|Less ceded unpaid losses and loss adjustment expenses, beginning
    of year |  |      | 186,178 |   |      |   | 160,236 |      |  |   | 164,269 | 
|                                                                             |  |      |         |   |      |   |         |      | 
|Net unpaid losses and loss adjustment expenses,
    beginning of year        |  |      | 29,484  |   |      |   | 29,484  |      |  |   | 29,484  | 
|Net losses and loss adjustment expenses incurred                             |  |      | 21,245  |   |      |   |        |      |  |   |        | 
|Net paid losses and loss adjustment expenses                                 |  |      |        |   |      |   |        |      |  |   |        | 
|                                                                             |  |      |         |   |      |   |         |      | 
|Net unpaid losses and loss adjustment expenses, end of year                  |  |      | 50,729  |   |      |   | 29,484  |      |  |   | 29,484  | 
|Add ceded unpaid losses and loss adjustment expenses,
    end of year        |  |      | 191,422 |   |      |   | 186,178 |      |  |   | 160,236 | 
|                                                                             |  |      |         |   |      |   |         |      | 
|Gross unpaid losses and loss adjustment expenses, end of year                |  | $    | 242,151 |   |      | $ | 215,662 |      |  | $ | 189,720 | 
|                                                                             |  |      |         |   |      |   |         |      | 
|Environmental                                                                |  |      |         |   |      |   |         |      |  |   |         | 
|Gross unpaid losses and loss adjustment expenses,
    beginning of year      |  | $    | 33,272  |   |      | $ | 45,712  |      |  | $ | 55,529  | 
|Less ceded unpaid losses and loss adjustment expenses, beginning
    of year |  |      | 1,135   |   |      |   | 13,575  |      |  |   | 23,392  | 
|                                                                             |  |      |         |   |      |   |         |      | 
|Net unpaid losses and loss adjustment expenses,
    beginning of year        |  |      | 32,137  |   |      |   | 32,137  |      |  |   | 32,137  | 
|Net losses and loss adjustment expenses incurred                             |  |      | (21,245 | ) |      |   |        |      |  |   |        | 
|Net paid losses and loss adjustment expenses                                 |  |      |        |   |      |   |        |      |  |   |        | 
|                                                                             |  |      |         |   |      |   |         |      | 
|Net unpaid losses and loss adjustment expenses, end of year                  |  |      | 10,892  |   |      |   | 32,137  |      |  |   | 32,137  | 
|Add ceded unpaid losses and loss adjustment expenses,
    end of year        |  |      | 19,006  |   |      |   | 1,135   |      |  |   | 13,575  | 
|                                                                             |  |      |         |   |      |   |         |      | 
|Gross unpaid losses and loss adjustment expenses, end of year                |  | $    | 29,898  |   |      | $ | 33,272  |      |  | $ | 45,712  | 
|                                                                             |  |      |         |   |      |   |         |      | 





103



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|    |                 
|--- | ----------------
|17. | Debt Obligations



|                                     |  |              |         |  |              |   |         | 
|------------------------------------ |  | ------------ | ------- |  | ------------ | - | ------- | 
|                                     |  | As of        |         |  | As of        |  
|                                     |  | December 31, |         |  | December 31, |  
|                                     |  | 2004         |         |  | 2003         |  
|                                     |  |              |         |  |              |  
|7.65% Senior Notes                   |  | $            | 224,616 |  |              | $ | 224,572 | 
|4.375% Convertible Senior Debentures |  |              | 109,900 |  |              |   | 110,000 | 
|7.49% Senior Notes                   |  |              | 41,524  |  |              |   | 42,320  | 
|                                     |  |              |         |  |              |  
|Total debt obligations               |  | $            | 376,040 |  |              | $ | 376,892 | 
|                                     |  |              |         |  |              |  







104



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|      |       |   |         |         | 
|----- | ----- | - | ------- | ------- | 
|Years |       |   | Amount  |        
|      |       |   |         |        
|2006  |       | $ | 40,000  |        
|2013  |       |   | 225,000 |        
|2022  |       |   | 109,900 |        
|      |       |   |        
|      | Total |   | $       | 374,900 | 
|      |       |   |        







|    |                  
|--- | -----------------
|18. | Segment Reporting



105



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |         |        |   |   |           |         |  
|------------------------------------------------- | ------------------------------------------------- | -------- | --------- | ------- | -------- | - | ------- | ------------- | - | - | -------------- | ------ | - | ----- | ------- | ------ | - | - | --------- | ------- | -
|Year Ended December 31, 2004                      |                                                   | Americas |           |         | EuroAsia |   |         | London Market |   |   | U.S. Insurance |        |   | Total |        
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Gross premiums written(1)                         |                                                   | $        | 1,263,210 |         |          | $ | 553,671 |               |   | $ | 447,681        |        |   | $     | 412,069 |        |   | $ | 2,676,631 |        
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Net premiums written                              |                                                   | $        | 1,208,178 |         |          | $ | 530,511 |               |   | $ | 388,245        |        |   | $     | 235,643 |        |   | $ | 2,362,577 |        
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Net premiums earned                               |                                                   | $        | 1,229,393 |         |          | $ | 482,096 |               |   | $ | 421,219        |        |   | $     | 198,359 |        |   | $ | 2,331,067 |        
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Losses and loss adjustment expenses               |                                                   |          | 906,081   |         |          |   | 299,791 |               |   |   | 293,560        |        |   |       | 130,132 |        |   |   | 1,629,564 |        
|Acquisition costs and other underwriting expenses |                                                   |          | 389,707   |         |          |   | 123,099 |               |   |   | 103,024        |        |   |       | 38,274  |        |   |   | 654,104   |        
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Total underwriting deductions                     |                                                   |          | 1,295,788 |         |          |   | 422,890 |               |   |   | 396,584        |        |   |       | 168,406 |        |   |   | 2,283,668 |        
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|                                                  | Underwriting (loss) income                        |          | $         | (66,395 | )        |   | $       | 59,206        |   |   | $              | 24,635 |   |       | $       | 29,953 |   |   |           | 47,399  |  
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Net investment income                             |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |         |        |   |   | 164,703   |        
|Net realized investment gains                     |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |         |        |   |   | 113,464   |        
|Other expense, net                                |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |         |        |   |   | (21,207   | )      
|Interest expense                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |         |        |   |   | (25,609   | )      
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|                                                  | Income before income taxes                        |          |           |         |          |   |         |               |   |   |                |        |   |       |         |        |   |   | $         | 278,750 |  
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Underwriting ratios:                              |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |         |        |   |   |           |        
|                                                  | Losses and loss adjustment expenses               |          |           | 73.7    | %        |   |         | 62.2          | % |   |                | 69.7   | % |       |         | 65.6   | % |   |           | 69.9    | %
|                                                  | Acquisition costs and other underwriting expenses |          |           | 31.7    |          |   |         | 25.5          |   |   |                | 24.5   |   |       |         | 19.3   |   |   |           | 28.1    |  
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|                                                  | Combined ratio                                    |          |           | 105.4   | %        |   |         | 87.7          | % |   |                | 94.2   | % |       |         | 84.9   | % |   |           | 98.0    | %
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        

106



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |         |       |   |   |           |         |  
|------------------------------------------------- | ------------------------------------------------- | -------- | --------- | ------- | -------- | - | ------- | ------------- | - | - | -------------- | ------ | - | ----- | ------- | ----- | - | - | --------- | ------- | -
|Year Ended December 31, 2003                      |                                                   | Americas |           |         | EuroAsia |   |         | London Market |   |   | U.S. Insurance |        |   | Total |        
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Gross premiums written(1)                         |                                                   | $        | 1,421,381 |         |          | $ | 408,077 |               |   | $ | 437,902        |        |   | $     | 333,821 |       |   | $ | 2,601,181 |        
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Net premiums written                              |                                                   | $        | 1,248,938 |         |          | $ | 388,705 |               |   | $ | 374,568        |        |   | $     | 141,369 |       |   | $ | 2,153,580 |        
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Net premiums earned                               |                                                   | $        | 1,170,696 |         |          | $ | 364,542 |               |   | $ | 334,228        |        |   | $     | 95,627  |       |   | $ | 1,965,093 |        
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Losses and loss adjustment expenses               |                                                   |          | 801,295   |         |          |   | 248,652 |               |   |   | 205,458        |        |   |       | 70,360  |       |   |   | 1,325,765 |        
|Acquisition costs and other underwriting expenses |                                                   |          | 380,737   |         |          |   | 90,658  |               |   |   | 89,366         |        |   |       | 16,562  |       |   |   | 577,323   |        
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Total underwriting deductions                     |                                                   |          | 1,182,032 |         |          |   | 339,310 |               |   |   | 294,824        |        |   |       | 86,922  |       |   |   | 1,903,088 |        
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|                                                  | Underwriting (loss) income                        |          | $         | (11,336 | )        |   | $       | 25,232        |   |   | $              | 39,404 |   |       | $       | 8,705 |   |   |           | 62,005  |  
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Net investment income                             |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |         |       |   |   | 134,115   |        
|Net realized investment gains                     |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |         |       |   |   | 202,742   |        
|Other expense, net                                |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |         |       |   |   | (7,912    | )      
|Interest expense                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |         |       |   |   | (12,656   | )      
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|                                                  | Income before income taxes                        |          |           |         |          |   |         |               |   |   |                |        |   |       |         |       |   |   | $         | 378,294 |  
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|Underwriting ratios:                              |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |         |       |   |   |           |        
|                                                  | Losses and loss adjustment expenses               |          |           | 68.5    | %        |   |         | 68.2          | % |   |                | 61.5   | % |       |         | 73.6  | % |   |           | 67.5    | %
|                                                  | Acquisition costs and other underwriting expenses |          |           | 32.5    |          |   |         | 24.9          |   |   |                | 26.7   |   |       |         | 17.3  |   |   |           | 29.3    |  
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        
|                                                  | Combined ratio                                    |          |           | 101.0   | %        |   |         | 93.1          | % |   |                | 88.2   | % |       |         | 90.9  | % |   |           | 96.8    | %
|                                                  |                                                   |          |           |         |          |   |         |               |   |   |                |        |   |       |        

107



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |         |       |   |   |           |         |  
|------------------------------------------------- | ------------------------------------------------- | -------- | --------- | ----- | -------- | - | ------- | ------------- | - | - | -------------- | ----- | - | ----- | ------- | ----- | - | - | --------- | ------- | -
|Year Ended December 31, 2002                      |                                                   | Americas |           |       | EuroAsia |   |         | London Market |   |   | U.S. Insurance |       |   | Total |        
|                                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |        
|Gross premiums written(1)                         |                                                   | $        | 1,189,003 |       |          | $ | 258,646 |               |   | $ | 315,257        |       |   | $     | 168,567 |       |   | $ | 1,931,473 |        
|                                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |        
|Net premiums written                              |                                                   | $        | 1,102,837 |       |          | $ | 249,650 |               |   | $ | 243,460        |       |   | $     | 35,298  |       |   | $ | 1,631,245 |        
|                                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |        
|Net premiums earned                               |                                                   | $        | 1,001,302 |       |          | $ | 221,531 |               |   | $ | 187,811        |       |   | $     | 21,998  |       |   | $ | 1,432,642 |        
|                                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |        
|Losses and loss adjustment expenses               |                                                   |          | 678,956   |       |          |   | 161,929 |               |   |   | 127,265        |       |   |       | 19,045  |       |   |   | 987,195   |        
|Acquisition costs and other underwriting expenses |                                                   |          | 313,861   |       |          |   | 59,180  |               |   |   | 55,736         |       |   |       | 3,754   |       |   |   | 432,531   |        
|                                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |        
|Total underwriting deductions                     |                                                   |          | 992,817   |       |          |   | 221,109 |               |   |   | 183,001        |       |   |       | 22,799  |       |   |   | 1,419,726 |        
|                                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |        
|                                                  | Underwriting income (loss)                        |          | $         | 8,485 |          |   | $       | 422           |   |   | $              | 4,810 |   |       | $       | (801  | ) |   |           | 12,916  |  
|                                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |        
|Net investment income                             |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |         |       |   |   | 123,028   |        
|Net realized investment gains                     |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |         |       |   |   | 135,796   |        
|Other income, net                                 |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |         |       |   |   | (4,985    | )      
|Interest expense                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |         |       |   |   | (8,689    | )      
|                                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |        
|                                                  | Income before income taxes                        |          |           |       |          |   |         |               |   |   |                |       |   |       |         |       |   |   | $         | 258,066 |  
|                                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |        
|Underwriting ratios:                              |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |         |       |   |   |           |        
|                                                  | Losses and loss adjustment expenses               |          |           | 67.8  | %        |   |         | 73.1          | % |   |                | 67.8  | % |       |         | 86.6  | % |   |           | 68.9    | %
|                                                  | Acquisition costs and other underwriting expenses |          |           | 31.3  |          |   |         | 26.7          |   |   |                | 29.7  |   |       |         | 17.1  |   |   |           | 30.2    |  
|                                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |        
|                                                  | Combined ratio                                    |          |           | 99.1  | %        |   |         | 99.8          | % |   |                | 97.5  | % |       |         | 103.7 | % |   |           | 99.1    | %
|                                                  |                                                   |          |           |       |          |   |         |               |   |   |                |       |   |       |        

Gross Premiums Written by Major Unit/ Division


|               |                                 |                          |           |           |      |   |           |           |  |   |           |           | 
|-------------- | ------------------------------- | ------------------------ | --------- | --------- | ---- | - | --------- | --------- |  | - | --------- | --------- | 
|               |                                 | Years Ended December 31, |          
|               |                                 |                          |          
|               |                                 | 2004                     |           |           | 2003 |   |           | 2002      | 
|               |                                 |                          |           |           |      |   |           |           | 
|United States  |                                 | $                        | 1,044,382 |           |      | $ | 1,188,030 |           |  | $ | 1,024,126 |          
|Latin America  |                                 |                          | 171,328   |           |      |   | 149,722   |           |  |   | 116,834   |          
|Canada         |                                 |                          | 46,028    |           |      |   | 79,512    |           |  |   | 40,770    |          
|London Branch  |                                 |                          | 1,472     |           |      |   | 4,117     |           |  |   | 7,273     |          
|               |                                 |                          |           |           |      |   |           |           | 
|               | Subtotal Americas               |                          |           | 1,263,210 |      |   |           | 1,421,381 |  |   |           | 1,189,003 | 
|EuroAsia       |                                 |                          | 553,671   |           |      |   | 408,077   |           |  |   | 258,646   |          
|London Market  |                                 |                          | 447,681   |           |      |   | 437,902   |           |  |   | 315,257   |          
|U.S. Insurance |                                 |                          | 412,069   |           |      |   | 333,821   |           |  |   | 168,567   |          
|               |                                 |                          |           |           |      |   |           |           | 
|               | Total gross premiums written(1) |                          | $         | 2,676,631 |      |   | $         | 2,601,181 |  |   | $         | 1,931,473 | 
|               |                                 |                          |           |           |      |   |           |           | 

108



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


Gross Premiums Written by Type of Business/ Business Unit


|                        |                                 |                          |         |           |      |   |         |           |  |   |         |           | 
|----------------------- | ------------------------------- | ------------------------ | ------- | --------- | ---- | - | ------- | --------- |  | - | ------- | --------- | 
|                        |                                 | Years Ended December 31, |        
|                        |                                 |                          |        
|                        |                                 | 2004                     |         |           | 2003 |   |         | 2002      | 
|                        |                                 |                          |         |           |      |   |         |           | 
|Property excess of loss |                                 | $                        | 108,375 |           |      | $ | 116,984 |           |  | $ | 114,742 |          
|Property proportional   |                                 |                          | 201,004 |           |      |   | 254,518 |           |  |   | 189,592 |          
|Casualty excess of loss |                                 |                          | 219,035 |           |      |   | 249,856 |           |  |   | 241,202 |          
|Casualty proportional   |                                 |                          | 479,671 |           |      |   | 573,944 |           |  |   | 460,564 |          
|Marine and aerospace    |                                 |                          | 33,564  |           |      |   | 20,680  |           |  |   | 13,040  |          
|Surety and credit       |                                 |                          | 47,825  |           |      |   | 45,403  |           |  |   | 28,717  |          
|Miscellaneous lines     |                                 |                          | 12,201  |           |      |   | 14,976  |           |  |   | 28,620  |          
|Facultative reinsurance |                                 |                          | 161,535 |           |      |   | 145,020 |           |  |   | 112,526 |          
|                        |                                 |                          |         |           |      |   |         |           | 
|                        | Subtotal Americas               |                          |         | 1,263,210 |      |   |         | 1,421,381 |  |   |         | 1,189,003 | 
|                        |                                 |                          |         |           |      |   |         |           | 
|Property excess of loss |                                 |                          | 126,739 |           |      |   | 99,348  |           |  |   | 57,753  |          
|Property proportional   |                                 |                          | 191,621 |           |      |   | 150,157 |           |  |   | 102,780 |          
|Casualty excess of loss |                                 |                          | 51,642  |           |      |   | 35,109  |           |  |   | 17,901  |          
|Casualty proportional   |                                 |                          | 54,029  |           |      |   | 26,903  |           |  |   | 24,704  |          
|Marine and aerospace    |                                 |                          | 41,756  |           |      |   | 29,947  |           |  |   | 16,003  |          
|Surety and credit       |                                 |                          | 58,462  |           |      |   | 40,429  |           |  |   | 11,726  |          
|Facultative reinsurance |                                 |                          | 4,482   |           |      |   | 8,596   |           |  |   | 24,614  |          
|First Capital           |                                 |                          | 24,940  |           |      |   | 17,588  |           |  |   | 3,165   |          
|                        |                                 |                          |         |           |      |   |         |           | 
|                        | Subtotal EuroAsia               |                          |         | 553,671   |      |   |         | 408,077   |  |   |         | 258,646   | 
|                        |                                 |                          |         |           |      |   |         |           | 
|London Branch           |                                 |                          |         |           |      |   |         |           |  |   |         |          
|Property excess of loss |                                 |                          | 66,159  |           |      |   | 47,966  |           |  |   | 45,877  |          
|Property proportional   |                                 |                          | 6,900   |           |      |   | 14,643  |           |  |   | 11,267  |          
|Casualty excess of loss |                                 |                          | 22,889  |           |      |   | 19,283  |           |  |   | 9,878   |          
|Casualty proportional   |                                 |                          | 23,531  |           |      |   | 14,992  |           |  |   | 6,948   |          
|Marine and aerospace    |                                 |                          | 63,003  |           |      |   | 57,567  |           |  |   | 43,506  |          
|Newline                 |                                 |                          |         |           |      |   |         |           |  |   |         |          
|Liability lines         |                                 |                          | 254,318 |           |      |   | 264,137 |           |  |   | 163,662 |          
|All other               |                                 |                          | 10,881  |           |      |   | 19,314  |           |  |   | 34,119  |          
|                        |                                 |                          |         |           |      |   |         |           | 
|                        | Subtotal London Market          |                          |         | 447,681   |      |   |         | 437,902   |  |   |         | 315,257   | 
|                        |                                 |                          |         |           |      |   |         |           | 
|Healthcare              |                                 |                          | 137,704 |           |      |   | 110,615 |           |  |   |        |          
|Property                |                                 |                          | 31,995  |           |      |   | 37,878  |           |  |   | 27,608  |          
|Casualty                |                                 |                          | 134,162 |           |      |   | 97,165  |           |  |   | 73,696  |          
|Auto                    |                                 |                          | 108,208 |           |      |   | 88,163  |           |  |   | 67,263  |          
|                        |                                 |                          |         |           |      |   |         |           | 
|                        | Subtotal U.S. Insurance         |                          |         | 412,069   |      |   |         | 333,821   |  |   |         | 168,567   | 
|                        |                                 |                          |         |           |      |   |         |           | 
|                        | Total gross premiums written(1) |                          | $       | 2,676,631 |      |   | $       | 2,601,181 |  |   | $       | 1,931,473 | 
|                        |                                 |                          |         |           |      |   |         |           | 






|    |                                                                                                                                                                                                                                                                                                                                                   
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | A portion of the gross premiums written by the
    U.S. Insurance division has been ceded to, and is also
    included in, the Americas divisions gross premiums
    written. Accordingly, the total gross premiums written as shown
    in the tables above do not agree to the gross premiums written
    of $2,656.5 million, $2,558.2 million

109



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                                                                                                                         
| | --------------------------------------------------------------------------------------------------------------------------------------------------------
| | and $1,894.5 million for the years ended December 31,
    2004, 2003 and 2002, respectively, reflected in the consolidated
    statements of operations.



| |                                                                                                                                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Company does not maintain separate balance sheet data for
    each of its operating segments. Accordingly, the Company does
    not review and evaluate the financial results of its operating
    segments based upon balance sheet data.



|    |                                            
|--- | -------------------------------------------
|19. | Quarterly Financial Information (Unaudited)



|                              |         |                |         |      |          |   |         |               |  |   |              |      |  |      |         |      |  |   |           |      | 
|----------------------------- | ------- | -------------- | ------- | ---- | -------- | - | ------- | ------------- |  | - | ------------ | ---- |  | ---- | ------- | ---- |  | - | --------- | ---- | 
|                              |         | Quarters Ended |         |      |         
|                              |         |                |         |      |         
|                              |         | March 31,      |         |      | June 30, |   |         | September 30, |  |   | December 31, |      |  |     
|                              |         | 2004           |         |      | 2004     |   |         | 2004          |  |   | 2004         |      |  | Year |        
|                              |         |                |         |      |          |   |         |               |  |   |              |      |  |      |        
|Gross premiums written        |         | $              | 629,483 |      |          | $ | 611,976 |               |  | $ | 754,232      |      |  | $    | 660,818 |      |  | $ | 2,656,509 |     
|Net premiums written          |         |                | 553,239 |      |          |   | 550,011 |               |  |   | 671,283      |      |  |      | 588,044 |      |  |   | 2,362,577 |     
|Net premiums earned           |         |                | 546,261 |      |          |   | 580,114 |               |  |   | 590,007      |      |  |      | 614,685 |      |  |   | 2,331,067 |     
|Net investment income         |         |                | 35,462  |      |          |   | 35,105  |               |  |   | 46,192       |      |  |      | 47,944  |      |  |   | 164,703   |     
|Net realized investment gains |         |                | 34,839  |      |          |   | 32,417  |               |  |   | 33,625       |      |  |      | 12,583  |      |  |   | 113,464   |     
|Other expense, net            |         |                | (2,360  | )    |          |   | (2,596  | )             |  |   | (4,728       | )    |  |      | (11,523 | )    |  |   | (21,207   | )   
|Income before income taxes    |         |                | 88,861  |      |          |   | 88,895  |               |  |   | 27,852       |      |  |      | 73,142  |      |  |   | 278,750   |     
|Net income                    |         |                | 58,955  |      |          |   | 59,051  |               |  |   | 18,021       |      |  |      | 50,872  |      |  |   | 186,899   |     
|Net income per common share:  |         |                |         |      |          |   |         |               |  |   |              |      |  |      |         |      |  |   |           |     
|                              | Basic   |                | $       | 0.92 |          |   | $       | 0.92          |  |   | $            | 0.28 |  |      | $       | 0.79 |  |   | $         | 2.90 | 
|                              | Diluted |                | $       | 0.85 |          |   | $       | 0.85          |  |   | $            | 0.27 |  |      | $       | 0.74 |  |   | $         | 2.71 | 

|                              |         |                |         |      |          |   |         |               |  |   |              |      |  |      |         |      |  |   |           |      | 
|----------------------------- | ------- | -------------- | ------- | ---- | -------- | - | ------- | ------------- |  | - | ------------ | ---- |  | ---- | ------- | ---- |  | - | --------- | ---- | 
|                              |         | Quarters Ended |         |      |         
|                              |         |                |         |      |         
|                              |         | March 31,      |         |      | June 30, |   |         | September 30, |  |   | December 31, |      |  |     
|                              |         | 2003           |         |      | 2003     |   |         | 2003          |  |   | 2003         |      |  | Year |        
|                              |         |                |         |      |          |   |         |               |  |   |              |      |  |      |        
|Gross premiums written        |         | $              | 563,841 |      |          | $ | 609,876 |               |  | $ | 702,953      |      |  | $    | 681,486 |      |  | $ | 2,558,156 |     
|Net premiums written          |         |                | 489,929 |      |          |   | 542,714 |               |  |   | 582,157      |      |  |      | 538,780 |      |  |   | 2,153,580 |     
|Net premiums earned           |         |                | 447,323 |      |          |   | 481,148 |               |  |   | 513,842      |      |  |      | 522,780 |      |  |   | 1,965,093 |     
|Net investment income         |         |                | 32,400  |      |          |   | 26,740  |               |  |   | 31,839       |      |  |      | 43,136  |      |  |   | 134,115   |     
|Net realized investment gains |         |                | 38,264  |      |          |   | 131,551 |               |  |   | 17,263       |      |  |      | 15,664  |      |  |   | 202,742   |     
|Other expense, net            |         |                | (2,967  | )    |          |   | (730    | )             |  |   | (1,558       | )    |  |      | (2,657  | )    |  |   | (7,912    | )   
|Income before income taxes    |         |                | 70,392  |      |          |   | 171,891 |               |  |   | 63,680       |      |  |      | 72,331  |      |  |   | 378,294   |     
|Net income                    |         |                | 46,579  |      |          |   | 112,687 |               |  |   | 42,328       |      |  |      | 47,631  |      |  |   | 249,225   |     
|Net income per common share:  |         |                |         |      |          |   |         |               |  |   |              |      |  |      |         |      |  |   |           |     
|                              | Basic   |                | $       | 0.72 |          |   | $       | 1.74          |  |   | $            | 0.65 |  |      | $       | 0.74 |  |   | $         | 3.85 | 
|                              | Diluted |                | $       | 0.67 |          |   | $       | 1.61          |  |   | $            | 0.61 |  |      | $       | 0.69 |  |   | $         | 3.59 | 





110



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##### 



SCHEDULE I


ODYSSEY RE HOLDINGS CORP.


SUMMARY OF INVESTMENTS


OTHER THAN INVESTMENTS IN RELATED PARTIES


|                                  |                               |                                                                  |                                                  |             |            |           |         |               |           |           |         |   |           |           | 
|--------------------------------- | ----------------------------- | ---------------------------------------------------------------- | ------------------------------------------------ | ----------- | ---------- | --------- | ------- | ------------- | --------- | --------- | ------- | - | --------- | --------- | 
|                                  |                               | December 31, 2004                                                |                                                 
|                                  |                               |                                                                  |                                                 
|                                  |                               |                                                                  |                                                  | Amount at   |           
|                                  |                               |                                                                  |                                                  | Which Shown |           
|                                  |                               | Amortized                                                        |                                                  |             |            |           | in the  |              
|Type of Investment                |                               | Cost                                                             |                                                  |             | Fair Value |           |         | Balance Sheet |          
|                                  |                               |                                                                  |                                                  |             |            |           |         |               |          
|                                  |                               | (In thousands)                                                   |                                                 
|Fixed income securities:          |                               |                                                                  |                                                  |             |            |           |         |               |           |           |         |  
|                                  | Bonds available for sale:     |                                                                  |                                                  |             |            |           |         |               |           |           |         |   |          
|                                  |                               | United States government and government agencies and authorities |                                                  | $           | 1,400,338  |           |         | $             | 1,363,012 |           |         | $ | 1,363,012 |          
|                                  |                               | States, municipalities and political subdivisions                |                                                  |             | 186,958    |           |         |               | 183,488   |           |         |   | 183,488   |          
|                                  |                               | Foreign governments                                              |                                                  |             | 336,777    |           |         |               | 344,410   |           |         |   | 344,410   |          
|                                  |                               | All other corporate                                              |                                                  |             | 554,541    |           |         |               | 614,720   |           |         |   | 614,720   |          
|                                  |                               |                                                                  |                                                  |             |            |           |         |               |          
|                                  |                               |                                                                  | Total fixed income securities available for sale |             |            | 2,478,614 |         |               |           | 2,505,630 |         |   |           | 2,505,630 | 
|                                  |                               |                                                                  |                                                  |             |            |           |         |               |          
|Equity securities, at fair value: |                               |                                                                  |                                                  |             |            |           |         |               |           |           |         |  
|                                  | Common stocks, at fair value: |                                                                  |                                                  |             |            |           |         |               |           |           |         |   |          
|                                  |                               | Bank, trusts and insurance companies                             |                                                  |             | 524,056    |           |         |               | 663,630   |           |         |   | 663,630   |          
|                                  |                               | Industrial and miscellaneous and all other                       |                                                  |             | 212,156    |           |         |               | 206,241   |           |         |   | 206,241   |          
|                                  |                               |                                                                  |                                                  |             |            |           |         |               |          
|                                  |                               |                                                                  | Total equity securities, at fair value           |             |            | 736,212   |         |               |           | 869,871   |         |   |           | 869,871   | 
|                                  |                               |                                                                  |                                                  |             |            |           |         |               |          
|Short-term investments            |                               |                                                                  | 213,403                                          |             |            |           | 213,403 |               |           |           | 213,403 |  
|                                  |                               |                                                                  |                                                  |             |            |           |         |               |          
|Other invested assets             |                               |                                                                  | 147,059                                          |             |            |           | 149,075 |               |           |           | 149,075 |  
|                                  |                               |                                                                  |                                                  |             |            |           |         |               |          
|                                  |                               |                                                                  | Total                                            |             | $          | 3,575,288 |         |               | $         | 3,737,979 |         |   | $         | 3,737,979 | 
|                                  |                               |                                                                  |                                                  |             |            |           |         |               |          

111



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##### 



SCHEDULE II


ODYSSEY RE HOLDINGS CORP.


CONDENSED FINANCIAL INFORMATION OF REGISTRANT


(PARENT COMPANY)


CONDENSED BALANCE SHEETS


|                                                                                           |                                     |                                            |         |           |           |   |         |           |           | 
|------------------------------------------------------------------------------------------ | ----------------------------------- | ------------------------------------------ | ------- | --------- | --------- | - | ------- | --------- | --------- | 
|                                                                                           |                                     | December 31,                               |        
|                                                                                           |                                     |                                            |        
|                                                                                           |                                     | 2004                                       |         |           | 2003      |  
|                                                                                           |                                     |                                            |         |           |           |  
|                                                                                           |                                     | (In thousands,                             |        
|                                                                                           |                                     | except share amounts)                      |        
|ASSETS                                                                                    
|Investments and cash:                                                                      |                                     |                                            |         |           |           |   |         |          
|                                                                                           | Investment in subsidiary, at equity |                                            | $       | 1,952,841 |           |   | $       | 1,729,412 |          
|                                                                                           | Cash and cash equivalents           |                                            |         | 1,743     |           |   |         | 13,914    |          
|                                                                                           |                                     |                                            |         |           |           |  
|                                                                                           |                                     | Total investments and cash                 |         |           | 1,954,584 |   |         |           | 1,743,326 | 
|Investment income due and accrued                                                          |                                     |                                            |        |           |           |   | 7       |          
|Federal and foreign income taxes recoverable                                               |                                     |                                            | 20,485  |           |           |   | 31,140  |          
|Other assets                                                                               |                                     |                                            | 7,704   |           |           |   | 4,811   |          
|                                                                                           |                                     |                                            |         |           |           |  
|                                                                                           |                                     | Total assets                               |         | $         | 1,982,773 |   |         | $         | 1,779,284 | 
|                                                                                           |                                     |                                            |         |           |           |  
|                                                                                          
|LIABILITIES                                                                               
|Debt obligations                                                                           |                                     | $                                          | 376,040 |           |           | $ | 376,892 |          
|Interest payable                                                                           |                                     |                                            | 3,271   |           |           |   | 3,319   |          
|Other liabilities                                                                          |                                     |                                            | 17,962  |           |           |   | 8,838   |          
|                                                                                           |                                     |                                            |         |           |           |  
|                                                                                           |                                     | Total liabilities                          |         |           | 397,273   |   |         |           | 389,049   | 
|                                                                                           |                                     |                                            |         |           |           |  
|                                                                                          
|STOCKHOLDERS EQUITY                                                                      
|Preferred stock, $0.01 par value; 200,000,000 shares
    authorized; 0 shares issued       |                                     |                                            |        |           |           |   |        |          
|Common stock, $0.01 par value; 500,000,000 shares
    authorized; 65,142,857 shares issued |                                     |                                            | 651     |           |           |   | 651     |          
|Additional paid-in capital                                                                 |                                     |                                            | 794,055 |           |           |   | 793,586 |          
|Treasury stock, at cost (387,879 and 146,691 shares,
    respectively)                     |                                     |                                            | (9,426  | )         |           |   | (2,549  | )        
|Unearned compensation                                                                      |                                     |                                            | (4,977  | )         |           |   | (3,439  | )        
|Accumulated other comprehensive income, net of deferred income
    taxes                   |                                     |                                            | 136,849 |           |           |   | 112,430 |          
|Retained earnings                                                                          |                                     |                                            | 668,348 |           |           |   | 489,556 |          
|                                                                                           |                                     |                                            |         |           |           |  
|                                                                                           |                                     | Total stockholders equity                 |         |           | 1,585,500 |   |         |           | 1,390,235 | 
|                                                                                           |                                     |                                            |         |           |           |  
|                                                                                           |                                     | Total liabilities and stockholders equity |         | $         | 1,982,773 |   |         | $         | 1,779,284 | 
|                                                                                           |                                     |                                            |         |           |           |  



112



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##### 



SCHEDULE II


ODYSSEY RE HOLDINGS CORP.


CONDENSED FINANCIAL INFORMATION OF REGISTRANT


(PARENT COMPANY)


CONDENSED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS


|                                                 |                                              |                          |         |         |      |   |         |         |   |   |         |         |  
|------------------------------------------------ | -------------------------------------------- | ------------------------ | ------- | ------- | ---- | - | ------- | ------- | - | - | ------- | ------- | -
|                                                 |                                              | Years Ended December 31, |        
|                                                 |                                              |                          |        
|                                                 |                                              | 2004                     |         |         | 2003 |   |         | 2002    |  
|                                                 |                                              |                          |         |         |      |   |         |         |  
|                                                 |                                              | (In thousands)           |        
|REVENUES                                         |                                              |                          |         |         |      |   |         |         |   |   |         |        
|Net investment income                            |                                              | $                        | 10      |         |      | $ | 145     |         |   | $ | 904     |        
|Net realized capital gains (losses)              |                                              |                          | 1       |         |      |   | (21     | )       |   |   | 66      |        
|Equity in undistributed net income of subsidiary |                                              |                          | 210,981 |         |      |   | 262,514 |         |   |   | 215,681 |        
|                                                 |                                              |                          |         |         |      |   |         |         |  
|                                                 | Total revenues                               |                          |         | 210,992 |      |   |         | 262,638 |   |   |         | 216,651 |  
|                                                 |                                              |                          |         |         |      |   |         |         |  
|EXPENSES                                         |                                              |                          |         |         |      |   |         |         |   |   |         |        
|Other expense, net                               |                                              |                          | 13,477  |         |      |   | 7,912   |         |   |   | 4,985   |        
|Interest expense                                 |                                              |                          | 25,609  |         |      |   | 12,656  |         |   |   | 8,689   |        
|                                                 |                                              |                          |         |         |      |   |         |         |  
|                                                 | Total expense                                |                          |         | 39,086  |      |   |         | 20,568  |   |   |         | 13,674  |  
|                                                 |                                              |                          |         |         |      |   |         |         |  
|                                                 | Income before income taxes                   |                          |         | 171,906 |      |   |         | 242,070 |   |   |         | 202,977 |  
|                                                 |                                              |                          |         |         |      |   |         |         |  
|Federal and foreign income tax benefit:          |                                              |                          |         |         |      |   |         |         |   |   |         |        
|                                                 | Current                                      |                          |         | (3,452  | )    |   |         |        |   |   |         |        |  
|                                                 | Deferred                                     |                          |         | (11,541 | )    |   |         | (7,155  | ) |   |         | (5,200  | )
|                                                 |                                              |                          |         |         |      |   |         |         |  
|                                                 | Total federal and foreign income tax benefit |                          |         | (14,993 | )    |   |         | (7,155  | ) |   |         | (5,200  | )
|                                                 |                                              |                          |         |         |      |   |         |         |  
|Net income to common stockholder                 |                                              |                          | 186,899 |         |      |   | 249,225 |         |   |   | 208,177 |        
|Retained earnings, beginning of year             |                                              |                          | 489,556 |         |      |   | 247,239 |         |   |   | 45,576  |        
|Dividends to common stockholder                  |                                              |                          | (8,107  | )       |      |   | (6,908  | )       |   |   | (6,514  | )      
|                                                 |                                              |                          |         |         |      |   |         |         |  
|Retained earnings, end of year                   |                                              | $                        | 668,348 |         |      | $ | 489,556 |         |   | $ | 247,239 |        
|                                                 |                                              |                          |         |         |      |   |         |         |  



113



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##### 



SCHEDULE II


ODYSSEY RE HOLDINGS CORP.


CONDENSED FINANCIAL INFORMATION OF REGISTRANT


(PARENT COMPANY)


CONDENSED STATEMENTS OF CASH FLOWS


|                                                                                                        |                                                  |                                                     |         |          |         |   |          |          |          |   |          |          |        |  
|------------------------------------------------------------------------------------------------------- | ------------------------------------------------ | --------------------------------------------------- | ------- | -------- | ------- | - | -------- | -------- | -------- | - | -------- | -------- | ------ | -
|                                                                                                        |                                                  | Years Ended December 31,                            |        
|                                                                                                        |                                                  |                                                     |        
|                                                                                                        |                                                  | 2004                                                |         |          | 2003    |   |          | 2002     |         
|                                                                                                        |                                                  |                                                     |         |          |         |   |          |          |         
|                                                                                                        |                                                  | (In thousands)                                      |        
|OPERATING ACTIVITIES                                                                                    |                                                  |                                                     |         |          |         |   |          |          |          |   |          |         
|Net income to common stockholder                                                                        |                                                  | $                                                   | 186,899 |          |         | $ | 249,225  |          |          | $ | 208,177  |         
|Adjustments to reconcile net income to common stockholder to net
    cash used in operating activities: |                                                  |                                                     |         |          |         |   |          |          |          |   |          |         
|                                                                                                        | Equity in undistributed net income of subsidiary |                                                     |         | (210,981 | )       |   |          | (262,514 | )        |   |          | (215,681 | )     
|                                                                                                        | Federal and foreign income taxes                 |                                                     |         | 10,655   |         |   |          | (642     | )        |   |          | (5,200   | )     
|                                                                                                        | Other assets and liabilities, net                |                                                     |         | 5,806    |         |   |          | 1,224    |          |   |          | 1,477    |       
|                                                                                                        | Bond premium amortization, net                   |                                                     |         |         |         |   |          | 24       |          |   |          | 388      |       
|                                                                                                        | Amortization of restricted stock                 |                                                     |         | 1,778    |         |   |          | 1,132    |          |   |          | 1,128    |       
|                                                                                                        | Net realized investment (gains) losses           |                                                     |         | (1       | )       |   |          | 21       |          |   |          | (66      | )     
|                                                                                                        |                                                  |                                                     |         |          |         |   |          |          |         
|                                                                                                        |                                                  | Net cash used in operating activities               |         |          | (5,844  | ) |          |          | (11,530  | ) |          |          | (9,777 | )
|                                                                                                        |                                                  |                                                     |         |          |         |   |          |          |         
|INVESTING ACTIVITIES                                                                                    |                                                  |                                                     |         |          |         |   |          |          |          |   |          |         
|Maturities of fixed income securities                                                                   |                                                  |                                                     |        |          |         |   | 15,000   |          |          |   |         |         
|Sales of fixed income securities                                                                        |                                                  |                                                     |        |          |         |   |         |          |          |   | 7,096    |         
|Acquisition of subsidiary                                                                               |                                                  |                                                     | (43,029 | )        |         |   |         |          |          |   | (17,757  | )       
|Capital contribution to subsidiary                                                                      |                                                  |                                                     |        |          |         |   | (165,000 | )        |          |   |         |         
|Decrease in short-term investments                                                                      |                                                  |                                                     |        |          |         |   |         |          |          |   | 14,779   |         
|                                                                                                        |                                                  |                                                     |         |          |         |   |          |          |         
|                                                                                                        |                                                  | Net cash (used in) provided by investing activities |         |          | (43,029 | ) |          |          | (150,000 | ) |          |          | 4,118  |  
|                                                                                                        |                                                  |                                                     |         |          |         |   |          |          |         
|FINANCING ACTIVITIES                                                                                    |                                                  |                                                     |         |          |         |   |          |          |          |   |          |         
|Proceeds from interest rate contract                                                                    |                                                  |                                                     |        |          |         |   | 8,667    |          |          |   |         |         
|Additional borrowings, net of acquisition costs                                                         |                                                  |                                                     |        |          |         |   | 222,480  |          |          |   | 107,494  |         
|Repayments of principal                                                                                 |                                                  |                                                     | (100    | )        |         |   | (50,000  | )        |          |   | (110,000 | )       
|Purchase of treasury stock                                                                              |                                                  |                                                     | (10,091 | )        |         |   | (284     | )        |          |   | (2,305   | )       
|Dividends                                                                                               |                                                  |                                                     | (8,107  | )        |         |   | (6,908   | )        |          |   | (6,514   | )       
|Dividend from subsidiary                                                                                |                                                  |                                                     | 55,000  |          |         |   |         |          |          |   | 18,000   |         
|                                                                                                        |                                                  |                                                     |         |          |         |   |          |          |         
|                                                                                                        |                                                  | Net cash provided by financing activities           |         |          | 36,702  |   |          |          | 173,955  |   |          |          | 6,675  |  
|                                                                                                        |                                                  |                                                     |         |          |         |   |          |          |         
|Increase in cash and cash equivalents                                                                   |                                                  |                                                     | (12,171 | )        |         |   | 12,425   |          |          |   | 1,016    |         
|Cash and cash equivalents, beginning of year                                                            |                                                  |                                                     | 13,914  |          |         |   | 1,489    |          |          |   | 473      |         
|                                                                                                        |                                                  |                                                     |         |          |         |   |          |          |         
|                                                                                                        |                                                  | Cash and cash equivalents, end of year              |         | $        | 1,743   |   |          | $        | 13,914   |   |          | $        | 1,489  |  
|                                                                                                        |                                                  |                                                     |         |          |         |   |          |          |         



114



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##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONDENSED FINANCIAL INFORMATION OF
REGISTRANT  PARENT ONLY






115



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##### 



SCHEDULE III


ODYSSEY RE HOLDINGS CORP.


SUPPLEMENTAL INSURANCE INFORMATION


AS OF DECEMBER 31, 2004 AND 2003 AND


FOR THE YEARS ENDED DECEMBER 31, 2004, 2003 AND 2002


(In thousands)


|                             |        |             |         |            |            |   |           |           |  |   |          |         |  |          |           |              |            |   |           |            |  |   |             |         |  |              |         |           |  |   |         |         |  |   |        |         | 
|---------------------------- | ------ | ----------- | ------- | ---------- | ---------- | - | --------- | --------- |  | - | -------- | ------- |  | -------- | --------- | ------------ | ---------- | - | --------- | ---------- |  | - | ----------- | ------- |  | ------------ | ------- | --------- |  | - | ------- | ------- |  | - | ------ | ------- | 
|                             |        |             |         |            |            |   |           |           |  |   |          |         |  |          |           | Amortization |            |   |          
|                             |        |             |         | Net unpaid |            |   |           |           |  |   |          |         |  |          |           |              | of net     |   |           |           
|                             |        | Deferred    |         |            | losses and |   |           |           |  |   |          |         |  |          |           | Net losses   |            |   | deferred  |            |  |  
|                             |        | policy      |         |            | loss       |   |           | Gross     |  |   | Net      |         |  | Net      |           |              | Net        |   |           | and loss   |  |   | policy      |         |  | Net          |        
|                             |        | acquisition |         |            | adjustment |   |           | unearned  |  |   | premiums |         |  | premiums |           |              | investment |   |           | adjustment |  |   | acquisition |         |  | underwriting |        
|Segment                      |        | costs       |         |            | expenses   |   |           | premiums  |  |   | written  |         |  | earned   |           |              | income     |   |           | expenses   |  |   | costs       |         |  | expenses     |        
|                             |        |             |         |            |            |   |           |           |  |   |          |         |  |          |           |              |            |   |           |            |  |   |             |         |  |              |        
|Year Ended December 31, 2004 |        |             |         |            |            |   |           |           |  |   |          |         |  |          |           |              |            |   |           |            |  |   |             |         |  |              |         |           |  |   |         |         |  |   |        |        
|Americas                     |        | $           | 95,075  |            |            | $ | 1,978,178 |           |  | $ | 374,451  |         |  | $        | 1,208,178 |              |            | $ | 1,229,393 |            |  | $ | 137,624     |         |  | $            | 906,081 |           |  | $ | 323,597 |         |  | $ | 66,110 |        
|EuroAsia                     |        |             | 35,796  |            |            |   | 369,185   |           |  |   | 133,847  |         |  |          | 530,511   |              |            |   | 482,096   |            |  |   | 6,409       |         |  |              | 299,791 |           |  |   | 104,877 |         |  |   | 18,222 |        
|London Market                |        |             | 25,815  |            |            |   | 589,125   |           |  |   | 151,884  |         |  |          | 388,245   |              |            |   | 421,219   |            |  |   | 14,654      |         |  |              | 293,560 |           |  |   | 75,603  |         |  |   | 27,421 |        
|U.S. Insurance               |        |             | 14,397  |            |            |   | 199,451   |           |  |   | 172,123  |         |  |          | 235,643   |              |            |   | 198,359   |            |  |   | 6,006       |         |  |              | 130,132 |           |  |   | 24,348  |         |  |   | 13,926 |        
|Holding Company              |        |             |        |            |            |   |          |           |  |   |         |         |  |          |          |              |            |   |          |            |  |   | 10          |         |  |              |        |           |  |   |        |         |  |   |       |        
|                             |        |             |         |            |            |   |           |           |  |   |          |         |  |          |           |              |            |   |           |            |  |   |             |         |  |              |        
|                             | Totals |             | $       | 171,083    |            |   | $         | 3,135,939 |  |   | $        | 832,305 |  |          | $         | 2,362,577    |            |   | $         | 2,331,067  |  |   | $           | 164,703 |  |              | $       | 1,629,564 |  |   | $       | 528,425 |  |   | $      | 125,679 | 
|                             |        |             |         |            |            |   |           |           |  |   |          |         |  |          |           |              |            |   |           |            |  |   |             |         |  |              |        
|Year Ended December 31, 2003 |        |             |         |            |            |   |           |           |  |   |          |         |  |          |           |              |            |   |           |            |  |   |             |         |  |              |         |           |  |   |         |         |  |   |        |        
|Americas                     |        | $           | 107,140 |            |            | $ | 1,669,640 |           |  | $ | 400,329  |         |  | $        | 1,248,938 |              |            | $ | 1,170,696 |            |  | $ | 122,924     |         |  | $            | 801,295 |           |  | $ | 326,200 |         |  | $ | 54,537 |        
|EuroAsia                     |        |             | 25,296  |            |            |   | 258,197   |           |  |   | 99,140   |         |  |          | 388,705   |              |            |   | 364,542   |            |  |   | 3,441       |         |  |              | 248,652 |           |  |   | 76,257  |         |  |   | 14,401 |        
|London Market                |        |             | 27,787  |            |            |   | 353,782   |           |  |   | 178,535  |         |  |          | 374,568   |              |            |   | 334,228   |            |  |   | 5,750       |         |  |              | 205,458 |           |  |   | 63,752  |         |  |   | 25,614 |        
|U.S. Insurance               |        |             | 8,066   |            |            |   | 60,035    |           |  |   | 141,836  |         |  |          | 141,369   |              |            |   | 95,627    |            |  |   | 1,855       |         |  |              | 70,360  |           |  |   | 9,806   |         |  |   | 6,756  |        
|Holding Company              |        |             |        |            |            |   |          |           |  |   |         |         |  |          |          |              |            |   |          |            |  |   | 145         |         |  |              |        |           |  |   |        |         |  |   |       |        
|                             |        |             |         |            |            |   |           |           |  |   |          |         |  |          |           |              |            |   |           |            |  |   |             |         |  |              |        
|                             | Totals |             | $       | 168,289    |            |   | $         | 2,341,654 |  |   | $        | 819,840 |  |          | $         | 2,153,580    |            |   | $         | 1,965,093  |  |   | $           | 134,115 |  |              | $       | 1,325,765 |  |   | $       | 476,015 |  |   | $      | 101,308 | 
|                             |        |             |         |            |            |   |           |           |  |   |          |         |  |          |           |              |            |   |           |            |  |   |             |         |  |              |        
|Year Ended December 31, 2002 |        |             |         |            |            |   |           |           |  |   |          |         |  |          |           |              |            |   |           |            |  |   |             |         |  |              |         |           |  |   |         |         |  |   |        |        
|Americas                     |        | $           | 85,805  |            |            | $ | 1,451,922 |           |  | $ | 314,165  |         |  | $        | 1,102,837 |              |            | $ | 1,001,302 |            |  | $ | 116,500     |         |  | $            | 678,956 |           |  | $ | 268,657 |         |  | $ | 45,204 |        
|EuroAsia                     |        |             | 18,057  |            |            |   | 160,783   |           |  |   | 69,393   |         |  |          | 249,650   |              |            |   | 221,531   |            |  |   | 2,512       |         |  |              | 161,929 |           |  |   | 50,796  |         |  |   | 8,384  |        
|London Market                |        |             | 22,595  |            |            |   | 219,748   |           |  |   | 132,812  |         |  |          | 243,460   |              |            |   | 187,811   |            |  |   | 1,572       |         |  |              | 127,265 |           |  |   | 37,961  |         |  |   | 17,775 |        
|U.S. Insurance               |        |             | 2,433   |            |            |   | 12,120    |           |  |   | 86,192   |         |  |          | 35,298    |              |            |   | 21,998    |            |  |   | 1,540       |         |  |              | 19,045  |           |  |   | 4,848   |         |  |   | (1,094 | )      
|Holding Company              |        |             |        |            |            |   |          |           |  |   |         |         |  |          |          |              |            |   |          |            |  |   | 904         |         |  |              |        |           |  |   |        |         |  |   |       |        
|                             |        |             |         |            |            |   |           |           |  |   |          |         |  |          |           |              |            |   |           |            |  |   |             |         |  |              |        
|                             | Totals |             | $       | 128,890    |            |   | $         | 1,844,573 |  |   | $        | 602,562 |  |          | $         | 1,631,245    |            |   | $         | 1,432,642  |  |   | $           | 123,028 |  |              | $       | 987,195   |  |   | $       | 362,262 |  |   | $      | 70,269  | 
|                             |        |             |         |            |            |   |           |           |  |   |          |         |  |          |           |              |            |   |           |            |  |   |             |         |  |              |        

116



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##### 



SCHEDULE IV


ODYSSEY RE HOLDINGS CORP.


REINSURANCE


|                              |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |   |           |           |  |  |      |      |  
|----------------------------- | ------------------------------- | ---------------------- | - | ---------- | --------- |  | -------- | --------- | --------- |  | ---------- | ------------- | ------- | -------------- | - | --------- | --------- |  |  | ---- | ---- | -
|                              |                                 |                        |   | Assumed    |           |  | Ceded to |           |           |  |            | Percentage of |        
|                              |                                 |                        |   | from other |           |  | other    |           |           |  |            | amount        |        
|                              |                                 | Direct                 |   |            | companies |  |          | companies |           |  | Net Amount |               |         | assumed to net |  
|                              |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |  
|                              |                                 | (In thousands)         |  
|Year Ended December 31, 2004: |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |   |           |           |  |  |     
|Premiums written:             |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |   |           |           |  |  |     
|                              | Life insurance                  |                        | $ |           |           |  | $        |          |           |  | $          |              |         |                | $ |          |           |  |  |     | %   
|                              | Accident and health insurance   |                        |   |           |           |  |          |          |           |  |            |              |         |                |   |          |           |  |  |     |     
|                              | Property and casualty insurance |                        |   | 702,127    |           |  |          | 1,954,382 |           |  |            | 293,932       |         |                |   | 2,362,577 |           |  |  | 82.7 |     
|                              | Title insurance                 |                        |   |           |           |  |          |          |           |  |            |              |         |                |   |          |           |  |  |     |     
|                              |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |  
|                              |                                 | Total premiums written |   | $          | 702,127   |  |          | $         | 1,954,382 |  |            | $             | 293,932 |                |   | $         | 2,362,577 |  |  |      | 82.7 | %
|                              |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |  
|Year Ended December 31, 2003: |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |   |           |           |  |  |     
|Premiums written:             |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |   |           |           |  |  |     
|                              | Life insurance                  |                        | $ |           |           |  | $        |          |           |  | $          |              |         |                | $ |          |           |  |  |     | %   
|                              | Accident and health insurance   |                        |   |           |           |  |          |          |           |  |            |              |         |                |   |          |           |  |  |     |     
|                              | Property and casualty insurance |                        |   | 634,860    |           |  |          | 1,923,296 |           |  |            | 404,576       |         |                |   | 2,153,580 |           |  |  | 89.3 |     
|                              | Title insurance                 |                        |   |           |           |  |          |          |           |  |            |              |         |                |   |          |           |  |  |     |     
|                              |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |  
|                              |                                 | Total premiums written |   | $          | 634,860   |  |          | $         | 1,923,296 |  |            | $             | 404,576 |                |   | $         | 2,153,580 |  |  |      | 89.3 | %
|                              |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |  
|Year Ended December 31, 2002: |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |   |           |           |  |  |     
|Premiums written:             |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |   |           |           |  |  |     
|                              | Life insurance                  |                        | $ |           |           |  | $        |          |           |  | $          |              |         |                | $ |          |           |  |  |     | %   
|                              | Accident and health insurance   |                        |   |           |           |  |          |          |           |  |            |              |         |                |   |          |           |  |  |     |     
|                              | Property and casualty insurance |                        |   | 296,855    |           |  |          | 1,597,675 |           |  |            | 263,285       |         |                |   | 1,631,245 |           |  |  | 97.9 |     
|                              | Title insurance                 |                        |   |           |           |  |          |          |           |  |            |              |         |                |   |          |           |  |  |     |     
|                              |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |  
|                              |                                 | Total premiums written |   | $          | 296,855   |  |          | $         | 1,597,675 |  |            | $             | 263,285 |                |   | $         | 1,631,245 |  |  |      | 97.9 | %
|                              |                                 |                        |   |            |           |  |          |           |           |  |            |               |         |                |  

117



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##### 



SCHEDULE VI


ODYSSEY RE HOLDINGS CORP.


SUPPLEMENTAL INFORMATION (FOR PROPERTY-CASUALTY INSURANCE
UNDERWRITERS)


(In thousands)


|                                                        |  |             |         |              |            |   |           |             |  |   |          |  |  |          |         |  |                     |                     |                      |              |        |          |           |          |            |        |         |  |             |   |           |            |  |   |         |  |  |   |         |  |  |   |         | 
|------------------------------------------------------- |  | ----------- | ------- | ------------ | ---------- | - | --------- | ----------- |  | - | -------- |  |  | -------- | ------- |  | ------------------- | ------------------- | -------------------- | ------------ | ------ | -------- | --------- | -------- | ---------- | ------ | ------- |  | ----------- | - | --------- | ---------- |  | - | ------- |  |  | - | ------- |  |  | - | ------- | 
|                                                        |  |             |         | Gross        |            |   |           |             |  |   |          |  |  |          |         |  |                     |                     |                      |              |       
|                                                        |  |             |         | reserves for |            |   |           |             |  |   |          |  |  |          |         |  | Net losses and loss |                     |                      | Amortization |        |          |          
|                                                        |  |             |         | unpaid       |            |   | Discount, |             |  |   |          |  |  |          |         |  |                     | adjustment expenses |                      |              | of net |          |           | Net paid |           
|                                                        |  | Deferred    |         |              | losses and |   |           | if any      |  |   |          |  |  |          |         |  |                     |                     | incurred related to: |              |        | deferred |           |          | losses and |       
|Affiliation                                             |  | policy      |         |              | loss       |   |           | deducted    |  |   | Gross    |  |  | Net      |         |  | Net                 |                     |                      | Net          |        |          |           |          |            | policy |         |  | loss        |  
|with                                                    |  | acquisition |         |              | adjustment |   |           | in previous |  |   | unearned |  |  | premiums |         |  | premiums            |                     |                      | investment   |        |          | current   |          |            | prior  |         |  | acquisition |   |           | adjustment | 
|Registrant                                              |  | costs       |         |              | expenses   |   |           | column      |  |   | premiums |  |  | written  |         |  | earned              |                     |                      | income       |        |          | Year      |          |            | Year   |         |  | costs       |   |           | expenses   | 
|                                                        |  |             |         |              |            |   |           |             |  |   |          |  |  |          |         |  |                     |                     |                      |              |        |          |           |          |            |        |         |  |             |   |           |            | 
|Year Ended December 31, 2004:                           |  |             |         |              |            |   |           |             |  |   |          |  |  |          |         |  |                     |                     |                      |              |        |          |           |          |            |        |         |  |             |   |           |            |  |   |         |  |  |   |         |  |  |   |         | 
|(a) Consolidated property-casualty insurance entities   |  | $           | 171,083 |              |            | $ | 4,228,021 |             |  | $ | 76,725   |  |  | $        | 832,305 |  |                     | $                   | 2,362,577            |              |        | $        | 2,331,067 |          |            | $      | 164,703 |  |             | $ | 1,448,360 |            |  | $ | 181,204 |  |  | $ | 528,425 |  |  | $ | 937,265 | 
|(b) Unconsolidated property-casualty insurance entities |  |             |        |              |            |   |          |             |  |   |         |  |  |          |        |  |                     |                     |                     |              |        |          |          |          |            |        |        |  |             |   |          |            |  |   |        |  |  |   |        |  |  |   |        | 
|Year Ended December 31, 2003:                           |  |             |         |              |            |   |           |             |  |   |          |  |  |          |         |  |                     |                     |                      |              |        |          |           |          |            |        |         |  |             |   |           |            |  |   |         |  |  |   |         |  |  |   |         | 
|(a) Consolidated property-casualty insurance entities   |  | $           | 168,289 |              |            | $ | 3,400,277 |             |  | $ | 66,682   |  |  | $        | 819,840 |  |                     | $                   | 2,153,580            |              |        | $        | 1,965,093 |          |            | $      | 134,115 |  |             | $ | 1,208,854 |            |  | $ | 116,911 |  |  | $ | 476,015 |  |  | $ | 843,367 | 
|(b) Unconsolidated property-casualty insurance entities |  |             |        |              |            |   |          |             |  |   |         |  |  |          |        |  |                     |                     |                     |              |        |          |          |          |            |        |        |  |             |   |          |            |  |   |        |  |  |   |        |  |  |   |        | 
|Year Ended December 31, 2002:                           |  |             |         |              |            |   |           |             |  |   |          |  |  |          |         |  |                     |                     |                      |              |        |          |           |          |            |        |         |  |             |   |           |            |  |   |         |  |  |   |         |  |  |   |         | 
|(a) Consolidated property-casualty insurance entities   |  | $           | 128,890 |              |            | $ | 2,871,552 |             |  | $ | 61,443   |  |  | $        | 602,562 |  |                     | $                   | 1,631,245            |              |        | $        | 1,432,642 |          |            | $      | 123,028 |  |             | $ | 921,222   |            |  | $ | 65,973  |  |  | $ | 362,262 |  |  | $ | 831,252 | 
|(b) Unconsolidated property-casualty insurance entities |  |             |        |              |            |   |          |             |  |   |         |  |  |          |        |  |                     |                     |                     |              |        |          |          |          |            |        |        |  |             |   |          |            |  |   |        |  |  |   |        |  |  |   |        | 

118



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##### 








|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|Item 9. | Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosures








|         |                        
|-------- | -----------------------
|Item 9A. | Controls and Procedures

Evaluation of disclosure controls and
procedures.


Managements annual report on internal control
over financial reporting.




Internal Control-Integrated Framework


Attestation report of the registered public
accounting firm.


Changes in internal controls over financial
reporting.









|         |                  
|-------- | -----------------
|Item 9B. | Other Information






PART III







|         |                                                   
|-------- | --------------------------------------------------
|Item 10. | Directors and Executive Officers of the Registrant



119



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##### 










|         |                       
|-------- | ----------------------
|Item 11. | Executive Compensation








|         |                                                                                                   
|-------- | --------------------------------------------------------------------------------------------------
|Item 12. | Security Ownership of Certain Beneficial Owners and
    Management and Related Stockholder Matters



Equity Compensation Plan Information




|                           |                              |                      |  |         |                     |  |   |                      |  |  |  |           |    
|-------------------------- | ---------------------------- | -------------------- |  | ------- | ------------------- |  | - | -------------------- |  |  |  | --------- | ---
|                           |                              | Number of Securities |  |         |                     |  |  
|                           |                              | to be Issued Upon    |  |         | Weighted Average    |  |   | Number of Securities | 
|                           |                              | Exercise of          |  |         | Exercise Price of   |  |   | Remaining Available  | 
|                           |                              | Outstanding Options  |  |         | Outstanding Options |  |   | For Future Issuance  | 
|                           |                              |                      |  |         |                     |  |   |                      | 
|Equity Compensation Plans: |                              |                      |  |         |                     |  |   |                      |  |  |  |          
|                           | Not approved by stockholders |                      |  |        |                     |  |   |                     |  |  |  |          |    
|                           | Approved by stockholders     |                      |  | 827,091 |                     |  | $ | 18.53                |  |  |  | 6,581,682 | (1)






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Includes options to purchase 725,563 shares of our
    common stock available for future grant under the Odyssey Re
    Holdings Corp. 2002 Stock Incentive Plan and 183,593 shares
    of our common stock available for future grant under the Odyssey
    Re Holdings Corp. (Non-Qualified) Employee Share Purchase Plan.
    In addition, under the terms of the Odyssey Re Holdings Corp.
    Restricted Share Plan and the Odyssey Re Holdings Corp. Stock
    Option Plan (the Plans), we are authorized to grant
    awards of restricted shares and stock options that together do
    not exceed 10% of our issued and outstanding shares of common
    stock as of the last business day of each calendar year. As of
    December 31, 2004, the number of restricted shares of our
    common stock authorized for future grant together with the
    number of shares of our common stock underlying options
    authorized for future grant was 5,672,526. OdysseyRe presently
    has no intention to grant any shares or options pursuant to the
    Plans.






|         |                                               
|-------- | ----------------------------------------------
|Item 13. | Certain Relationships and Related Transactions








|         |                                       
|-------- | --------------------------------------
|Item 14. | Principal Accountant Fees and Services








|         |                                           
|-------- | ------------------------------------------
|Item 15. | Exhibits and Financial Statement Schedules

Financial Statements and Schedules




Exhibits




120



---



##### 



SIGNATURES






| |                          
| | -------------------------
| | ODYSSEY RE HOLDINGS CORP.



| |  |  |        |                                    |  | 
| |  |  | ------ | ---------------------------------- |  | 
| |  |  | By:    | /s/ ANDREW A. BARNARD              | 
| |  |  | Name:  | Andrew A. Barnard                  | 
| |  |  | Title: | President, Chief Executive Officer | 





|                                             |  |                                                                                                       |  |               |  | 
|-------------------------------------------- |  | ----------------------------------------------------------------------------------------------------- |  | ------------- |  | 
|Signature                                    |  | Title                                                                                                 |  | Date         
|                                             |  |                                                                                                       |  |              
|                                            
|/s/ ANDREW A. BARNARDAndrew
    A. Barnard   |  | President, Chief Executive Officer and Director (Principal
    Executive Officer)                     |  | March 7, 2005
|                                            
|/s/ CHARLES D. TROIANOCharles
    D. Troiano |  | Executive Vice President and Chief Financial Officer
    (Principal Financial and Accounting Officer) |  | March 7, 2005
|                                            
|*V.
    Prem Watsa                           |  | Director                                                                                              |  | March 7, 2005
|                                            
|*James
    F. Dowd                           |  | Director                                                                                              |  | March 7, 2005
|                                            
|*Frank
    B. Bennett                        |  | Director                                                                                              |  | March 7, 2005
|                                            
|*Robbert
    Hartog                          |  | Director                                                                                              |  | March 7, 2005
|                                            
|*Anthony
    F. Griffiths                    |  | Director                                                                                              |  | March 7, 2005
|                                            
|*Brandon
    Sweitzer                        |  | Director                                                                                              |  | March 7, 2005
|                                            
|*Samuel
    A. Mitchell                      |  | Director                                                                                              |  | March 7, 2005
|                                            
|*By:                                         |  | /s/ CHARLES D. TROIANO
    Attorney-in-fact                                                           |  |               |  | 

121



---



##### 



EXHIBIT INDEX


|       |    |                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|------ | -- | ---------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number |    | Title of Exhibit
|       |    |                 
|       | 3  | .1               |  | Amended and Restated Certificate of Incorporation (incorporated
    herein by reference to the Registrants Amendment
    No. 1 to Registration Statement on Form S-1 (No.
    333-57642), filed with the Commission on May 4, 2001).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|       | 3  | .2               |  | Amended and Restated By-Laws (incorporated herein by reference
    to the Registrants Amendment No. 1 to Registration
    Statement on Form S-1 (No. 333-57642), filed with the
    Commission on May 4, 2001).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|       | 4  | .1               |  | Specimen Certificate representing Common Stock (incorporated
    herein by reference to the Registrants Amendment
    No. 2 to Registration Statement on Form S-1 (No.
    333-57642), filed with the Commission on May 29, 2001).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|       | 4  | .2               |  | Indenture dated June 18, 2002 between Odyssey Re Holdings
    Corp. and The Bank of New York regarding the
    4.375% Convertible Senior Debentures due 2022 (incorporated
    herein by reference to Exhibit 4.3 of the Registrants
    registration statement on Form S-3, filed on August 8,
    2002).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|       | 4  | .3               |  | Registration Rights Agreement dated June 18, 2002 between
    Odyssey Re Holdings Corp. and Banc of America Securities LLC
    regarding the 4.375% Convertible Senior Debentures due 2022
    (incorporated herein by reference to Exhibit 4.7 of the
    Registrants registration statement on Form S-3, filed
    on August 8, 2002).                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|       | 4  | .4               |  | Indenture dated October 31, 2003 between Odyssey Re
    Holdings Corp. and The Bank of New York regarding the
    7.65% Senior Notes due 2013 (incorporated by reference to
    Exhibit 4.1 of the Registrants Quarterly Report on
    Form 10-Q filed with the Commission on November 3,
    2003).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|       | 4  | .5               |  | Global Security dated October 31, 2003 representing
    $150,000,000 aggregate principal amount of 7.65% Senior
    Notes due 2013 (incorporated by reference to Exhibit 4.2 of
    the Registrants Quarterly Report on Form 10-Q filed
    with the Commission on November 3, 2003).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | 4  | .6               |  | Global Security dated November 18, 2003 representing
    $75,000,000 aggregate principal amount of 7.65% Senior
    Notes due 2013 (incorporated by reference to Exhibit 4.6 of
    the Registrants Annual Report on Form 10-K filed with
    the Commission on February 18, 2004).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       | 10 | .1               |  | Intentionally deleted.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | 10 | .2               |  | Intentionally deleted.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | 10 | .3               |  | Affiliate Guarantee by Odyssey America Reinsurance Corporation
    dated as of July 14, 2000 relating to Compagnie
    Transcontinentale de Réassurance (incorporated herein by
    reference to the Registrants Registration Statement on
    Form S-1 (No. 333-57642), filed with the Commission on
    March 26, 2001).                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|       | 10 | .4               |  | Blanket Assumption Endorsement Agreement between Ranger
    Insurance Company and Odyssey Reinsurance Corporation dated as
    of July 1, 1999 (incorporated herein by reference to the
    Registrants Registration Statement on Form S-1
    (No. 333-57642), filed with the Commission on
    March 26, 2001).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|       | 10 | .5               |  | Tax Allocation Agreement effective as of June 19, 2001
    among Fairfax Inc., Odyssey Re Holdings Corp., Odyssey America
    Reinsurance Corporation, Odyssey Reinsurance Corporation, and
    Hudson Insurance Company (incorporated herein by reference to
    the Registrants Annual Report on Form 10-K filed with
    the Commission on March 6, 2002) and Inter-Company Tax
    Allocation Agreement among TIG Holdings, Inc. and the subsidiary
    corporations party thereto and Agreement for the Allocation and
    Settlement of Consolidated Federal Income Tax Liability, as
    amended (each incorporated herein by reference to the
    Registrants Amendment No. 2 to Registration Statement
    on Form S-1 (No. 333-57642), filed with the Commission on
    May 29, 2001).
|       | 10 | .6               |  | Amended and Restated Employment Agreement dated as of
    April 1, 2001 between Andrew Barnard and Odyssey Re
    Holdings Corp. (incorporated herein by reference to the
    Registrants Amendment No. 1 to Registration Statement
    on Form S-1 (No. 333-57642), filed with the Commission
    on May 4, 2001).                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       | 10 | .7               |  | Employment Agreement dated as of October 1, 2001 between
    Charles D. Troiano and Odyssey Re Holdings Corp. (incorporated
    herein by reference to the Registrants Annual Report on
    Form 10-K filed with the Commission on March 6, 2002).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|       | 10 | .8               |  | Employment Agreement dated as of May 23, 2001 between
    Michael Wacek and Odyssey Re Holdings Corp (incorporated herein
    by reference to the Registrants Amendment No. 2 to
    Registration Statement on Form S-1 (No. 333-57642),
    filed with the Commission on May 29, 2001).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

122



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##### 



|       |       |                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|------ | ----- | ---------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number |       | Title of Exhibit
|       |       |                 
|       | 10.9  |                  |  | Third Amended and Modified Office Lease Agreement in relation to
    300 First Stamford Place, Stamford, Connecticut and
    guarantee of Odyssey Re Holdings Corp. executed in
    connection therewith (incorporated herein by reference to the
    Registrants Quarterly Report on Form 10-Q filed with
    the Commission on November 4, 2004) which amends the Lease
    Agreement between TIG Insurance Company and First Stamford Place
    Company, as amended (incorporated herein by reference to the
    Registrants Amendment No. 2 to Registration Statement
    on Form S-1 (No. 333-57642), filed with the Commission
    on May 29, 2001).
|       | 10.10 |                  |  | Registration Rights Agreement dated as of June 19, 2001
    among Odyssey Re Holdings Corp., TIG Insurance Company and
    ORH Holdings Inc. (incorporated herein by reference to the
    Registrants Annual Report on Form 10-K filed with the
    Commission on March 6, 2002).                                                                                                                                                                                                                                                                                                                                                                          
|       | 10.11 |                  |  | Investment Agreement dated as of January 1, 2002 between
    Hamblin Watsa Investment Counsel Ltd., Fairfax Financial
    Holdings Limited and Odyssey America Reinsurance Corporation
    (incorporated herein by reference to the Registrants
    Annual Report on Form 10-K filed with the Commission on
    March 6, 2002).                                                                                                                                                                                                                                                                                                                            
|       | 10.12 |                  |  | Investment Management Agreement between Hamblin Watsa Investment
    Counsel Ltd. and Odyssey Reinsurance Corporation dated as of
    May 11, 2001 (incorporated herein by reference to the
    Registrants Amendment No. 2 to Registration Statement
    on Form S-1 (No. 333-57642), filed with the Commission on
    May 29, 2001).                                                                                                                                                                                                                                                                                                                     
|       | 10.13 |                  |  | Investment Management Agreement between Hamblin Watsa Investment
    Counsel Ltd. and Hudson Insurance Company dated as of
    May 11, 2001 (incorporated herein by reference to the
    Registrants Amendment No. 2 to Registration Statement
    on Form S-1 (No. 333-57642), filed with the Commission
    on May 29, 2001).                                                                                                                                                                                                                                                                                                                            
|       | 10.14 |                  |  | Intentionally deleted.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|       | 10.15 |                  |  | Investment Administration Agreement between Fairfax Financial
    Holdings Limited and Odyssey Reinsurance Corporation dated as of
    May 11, 2001 (incorporated herein by reference to the
    Registrants Amendment No. 2 to Registration Statement
    on Form S-1 (No. 333-57642), filed with the Commission
    on May 29, 2001).                                                                                                                                                                                                                                                                                                                    
|       | 10.16 |                  |  | Investment Administration Agreement between Fairfax Financial
    Holdings Limited and Hudson Insurance Company dated as of
    May 11, 2001 (incorporated herein by reference to the
    Registrants Amendment No. 2 to Registration Statement
    on Form S-1 (No. 333-57642), filed with the Commission on
    May 29, 2001).                                                                                                                                                                                                                                                                                                                           
|       | 10.17 |                  |  | Stop Loss Agreement dated December 31, 1995 among Skandia
    America Reinsurance Corporation and Skandia Insurance Company
    Ltd., as amended (incorporated herein by reference to the
    Registrants Amendment No. 1 to Registration Statement
    on Form S-1 (No. 333-57642), filed with the Commission
    on May 4, 2001).                                                                                                                                                                                                                                                                                                                        
|       | 10.18 |                  |  | Indemnification Agreements between Odyssey Re Holdings Corp. and
    each of its directors and officers dated as of March 21,
    2001 (incorporated herein by reference to the Registrants
    Annual Report on Form 10-K filed with the Commission on
    March 6, 2002).                                                                                                                                                                                                                                                                                                                                                                                
|       | 10.19 |                  |  | Term Note dated as of June 19, 2001, including Postponement
    Agreement dated as of January 31, 2002 related thereto
    (incorporated herein by reference to the Registrants
    Annual Report on Form 10-K filed with the Commission on
    March 6, 2002).                                                                                                                                                                                                                                                                                                                                                                                            
|       | 10.20 |                  |  | Investment Management Agreement between Hamblin Watsa Investment
    Counsel Ltd. and Newline Underwriting Management Ltd. dated as
    of February 16, 2001 (incorporated herein by reference to
    the Registrants Amendment No. 2 to Registration
    Statement on Form S-1 (No. 333-57642), filed with the
    Commission on May 29, 2001).                                                                                                                                                                                                                                                                                                           
|       | 10.21 |                  |  | Intentionally deleted.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|       | 10.22 |                  |  | Indemnification Agreement in favor of Odyssey Reinsurance
    Corporation and Hudson Insurance Company from Fairfax Financial
    Holdings Limited dated as of March 22, 2001 (incorporated
    herein by reference to the Registrants Amendment
    No. 1 to Registration Statement on Form S-1
    (No. 333-57642), filed with the Commission on May 4,
    2001).                                                                                                                                                                                                                                                                                       

123



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##### 



|       |       |                  |  |                                                                                                                                                                                                                                                                                                                                                                             
|------ | ----- | ---------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number |       | Title of Exhibit
|       |       |                 
|       | 10.23 |                  |  | Indemnification Agreement in favor of Odyssey Reinsurance
    Corporation from Fairfax Financial Holdings Limited dated as of
    March 20, 2001 (incorporated herein by reference to the
    Registrants Amendment No. 1 to Registration Statement
    on Form S-1 (No. 333-57642), filed with the Commission
    on May 4, 2001).                                        
|       | 10.24 |                  |  | Odyssey America Reinsurance Corporation Restated Employees
    Retirement Plan, as amended (incorporated herein by reference to
    the Registrants Amendment No. 2 to Registration
    Statement on Form S-1 (No. 333-57642), filed with the
    Commission on May 29, 2001).                                                                                             
|       | 10.25 |                  |  | Odyssey America Reinsurance Corporation Profit Sharing Plan, as
    amended (incorporated herein by reference to the
    Registrants Amendment No. 2 to Registration Statement
    on Form S-1 (No. 333-57642), filed with the Commission
    on May 29, 2001).                                                                                                            
|       | 10.26 |                  |  | Odyssey Re Holdings Corp. Restricted Share Plan (incorporated
    herein by reference to the Registrants Amendment
    No. 3 to Registration Statement on Form S-1 (No.
    333-57642), filed with the Commission on June 7, 2001).                                                                                                                                        
|       | 10.27 |                  |  | Odyssey Re Holdings Corp. Stock Option Plan (incorporated herein
    by reference to the Registrants Amendment No. 3 to
    Registration Statement on Form S-1 (No. 333-57642), filed
    with the Commission on June 7, 2001).                                                                                                                                            
|       | 10.28 |                  |  | Odyssey Re Holdings Corp. Long-Term Incentive Plan (incorporated
    herein by reference to the Registrants Amendment
    No. 3 to Registration Statement on Form S-1
    (No. 333-57642), filed with the Commission on June 7,
    2001).                                                                                                                                 
|       | 10.29 |                  |  | Odyssey Re Holdings Corp. Employee Share Purchase Plan
    (incorporated herein by reference to the Registrants
    Amendment No. 3 to Registration Statement on Form S-1
    (No. 333-57642), filed with the Commission on June 7,
    2001).                                                                                                                             
|       | 10.30 |                  |  | Odyssey America Reinsurance Corporation 401(k) Excess Plan, as
    amended (incorporated herein by reference to the
    Registrants Amendment No. 2 to Registration Statement
    on Form S-1 (No. 333-57642), filed with the Commission
    on May 29, 2001).                                                                                                             
|       | 10.31 |                  |  | Odyssey America Reinsurance Corporation Restated Supplemental
    Retirement Plan, as amended (incorporated herein by reference to
    the Registrants Amendment No. 2 to Registration
    Statement on Form S-1 (No. 333-57642), filed with the
    Commission on May 29, 2001).                                                                                          
|       | 10.32 |                  |  | Exchange Agreement among TIG Insurance Company, ORH
    Holdings Inc. and Odyssey Re Holdings Corp dated as of
    June 19, 2001 (incorporated herein by reference to the
    Registrants Annual Report on Form 10-K filed with the
    Commission on March 6, 2002).                                                                                                      
|       | 10.33 |                  |  | Tax Services Agreement between Fairfax Inc., Odyssey America
    Reinsurance Corporation, Odyssey Reinsurance Corporation and
    Hudson Insurance Company dated as of May 10, 2001
    (incorporated herein by reference to the Registrants
    Amendment No. 2 to Registration Statement on Form S-1
    (No. 333-57642), filed with the Commission on May 29,
    2001).
|       | 10.34 |                  |  | Tax Services Agreement between Fairfax Inc. and Odyssey Re
    Holdings Corp. dated as of May 10, 2001 (incorporated
    herein by reference to the Registrants Amendment
    No. 2 to Registration Statement on Form S-1
    (No. 333-57642), filed with the Commission on May 29,
    2001).                                                                             
|       | 10.35 |                  |  | Note Purchase Agreement dated as of November 15, 2001
    among Odyssey Re Holdings Corp. and the purchasers listed
    in Schedule A attached thereto, including the form of Notes
    issued in connection therewith (incorporated herein by reference
    to the Registrants Annual Report on Form 10-K filed
    with the Commission on March 6, 2002).                
|       | 10.36 |                  |  | Intentionally deleted.                                                                                                                                                                                                                                                                                                                                                      
|       | 10.37 |                  |  | Intentionally deleted.                                                                                                                                                                                                                                                                                                                                                      
|       | 10.38 |                  |  | Odyssey Re Holdings Corp. 2002 Stock Incentive Plan
    (incorporated herein by reference to Appendix A of the
    Registrants definitive proxy statement filed on
    March 21, 2002).                                                                                                                                                                                    
|       | 10.39 |                  |  | Underwriting Agreement dated October 28, 2003 with respect
    to the 7.65% Senior Notes due 2013 (incorporated by
    reference to Exhibit 10.1 of the Registrants
    Quarterly Report on Form 10-Q filed with the Commission on
    November 3, 2003).                                                                                                                  

124



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##### 



|       |       |                  |  |                                                                                                                                                                                                                                                                                                                                              
|------ | ----- | ---------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number |       | Title of Exhibit
|       |       |                 
|       | 10.40 |                  |  | Underwriting Agreement dated November 13, 2003 with respect
    to the 7.65% Senior Notes due 2013 (incorporated by
    reference to Exhibit 4.6 of the Registrants Annual
    Report on Form 10-K filed with the Commission on
    February 18, 2004).                                                                                     
|       | 10.41 |                  |  | Credit Agreement dated as of September 27, 2004 among
    Odyssey Re Holdings Corp., Bank of America, N.A., and the other
    parties thereto, and the notes executed in connection therewith
    (incorporated herein by reference to the Registrants
    Quarterly Report on Form 10-Q filed with the Commission on
    November 4, 2004).
|       | *21.1 |                  |  | List of the Registrants Subsidiaries.                                                                                                                                                                                                                                                                                                       
|       | *23   |                  |  | Consent of PricewaterhouseCoopers LLP.                                                                                                                                                                                                                                                                                                       
|       | *24   |                  |  | Powers of Attorney.                                                                                                                                                                                                                                                                                                                          
|       | *31.1 |                  |  | Certification of President and Chief Executive Officer pursuant
    to Rule 13a-15(e) or 15d-15(e), as enacted pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                
|       | *31.2 |                  |  | Certification of Executive Vice President and Chief Financial
    Officer pursuant to Rule 13a-15(e) or 15d-15(e), as enacted
    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                 
|       | *32.1 |                  |  | Certification of President and Chief Executive Officer pursuant
    to 18 U.S.C. Section 1350, as enacted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                     
|       | *32.2 |                  |  | Certification of Executive Vice President and Chief Financial
    Officer pursuant to 18 U.S.C. Section 1350, as enacted
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                      






|  |                
|- | ---------------
|* | Filed herewith.

125