================================================================================

                                  UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

(Mark One)

   [X]       QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
             SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended
             March 31, 2007


   [ ]       TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
             EXCHANGE ACT OF 1934
             For the transition period from _______________ to _________________

                          Commission File No. 001-33374

                           CastlePoint Holdings, Ltd.
             (Exact name of registrant as specified in its charter)

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

                        Victoria Hall, 11 Victoria Street
                             Hamilton HM 11, Bermuda
               (Address of principal executive offices) (Zip code)

                                 (441) 294-6409
              (Registrant's telephone number, including area code)

               --------------------------------------------------

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

     Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check
one):

Large accelerated filer [ ]    Accelerated filer [ ]   Non-accelerated filer [X]

     Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act).                    Yes [ ]    No [X]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: 38,277,148 common shares, par
value $0.01 per share, as of May 7, 2007.

<PAGE>


                                TABLE OF CONTENTS
                                                                         PAGE

Part I - FINANCIAL INFORMATION..............................................2

Item 1.  Financial Statements...............................................2

Item 2.  Management's Discussion and Analysis of Financial Condition
          and Results of Operations........................................14

Item 3.  Quantitative and Qualitative Disclosures About Market Risk........23

Item 4.  Controls and Procedures...........................................24

Part II - OTHER INFORMATION................................................25

Item 1.  Legal Proceedings.................................................25

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.......25

Item 6.  Exhibits..........................................................25



                                EXPLANATORY NOTE

         This quarterly report is filed by CastlePoint Holdings, Ltd., a Bermuda
company limited by shares (the "Company"). Unless the context requires otherwise
or unless stated otherwise, the terms "we", "our" and "us" refer to the Company
and its subsidiaries. This is the first quarterly report filed by the Company
with the Securities and Exchange Commission (the "SEC") since the Company's
completion of the initial public offering of its common shares on March 28,
2007.





                                       1
<PAGE>

                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

<TABLE>
<CAPTION>

                           CastlePoint Holdings, Ltd.
                           Consolidated Balance Sheets

                                                                 (Unaudited)
                                                                  March 31,    December 31,
                                                                     2007          2006
                                                                ------------- -------------
                                                                 ($ in thousands, except par
                                                                   value and share amounts)
<S>                                                                 <C>            <C>
Assets
Fixed-maturity securities, available-for-sale, at fair value
 (amortized cost $408,356 for 2007; $293,878 for 2006)              $410,726      $295,527
Short-term investments, available-for-sale, at fair value
 (amortized cost $1,751 for 2007; $51,626 for 2006)                    1,751        51,638
                                                                ------------- -------------
    Total available-for-sale investments                             412,477       347,165
Investment in Tower Group, Inc. preferred stock                           --        40,000
Common trust securities - statutory business trusts,
 equity method                                                         3,094         3,094
                                                                ------------- -------------
    Total investments                                                415,571       390,259
Cash and cash equivalents                                            158,380        34,784
Accrued investment income                                              2,874         2,211
Assumed premiums receivable (primarily with related parties -
 See note 3 )                                                         52,534        44,930
Premiums receivable - programs (primarily with related parties -
 See note 3)                                                           1,994         1,295
Deferred acquisition costs (primarily with related parties -
 See note 3)                                                          38,605        30,363
Deferred income taxes                                                  1,614         1,089
Deferred financing fees                                                3,092         3,084
Other assets                                                           5,366         3,327
                                                                ------------- -------------
    Total Assets                                                    $680,030      $511,342
                                                                ============= =============
Liabilities and Shareholders' Equity
Liabilities
Loss and loss adjustment expenses (primarily with related
 parties - See note 3)                                               $54,113       $34,192
Unearned premium (primarily with related parties - See note 3)       111,482        86,181
Assumed losses payable (primarily with related parties -
 See note 3)                                                           5,393         3,496
Premiums payable-programs (primarily with related parties -
 See note 3)                                                           1,801         1,072
Accounts payable and accrued expenses                                  2,029         2,869
Other liabilities                                                      1,065           725
Subordinated debentures                                              103,094       103,094
                                                                ------------- -------------
   Total Liabilities                                                $278,977      $231,629
                                                                ------------- -------------
Shareholders' Equity
Common shares ($0.01 par value, 100,000,000 shares authorized;
 38,277,148 and 29,580,000 shares issued in 2007 and 2006)               383           296
Additional paid-in-capital                                           383,714       269,472
Accumulated other comprehensive net income                             2,337         1,657
Retained earnings                                                     14,619         8,288
                                                                ------------- -------------
   Total Shareholders' Equity                                        401,053       279,713
                                                                ------------- -------------
   Total Liabilities and Shareholders' Equity                       $680,030      $511,342
                                                                ============= =============

         See accompanying notes to the consolidated financial statements
</TABLE>


                                       2
<PAGE>

<TABLE>
<CAPTION>

                           CastlePoint Holdings, Ltd.
                      Consolidated Statements of Income and
                              Comprehensive Income
                                   (Unaudited)

                                                                       Three Months Ended
                                                                            March 31,
                                                                      2007            2006
                                                                --------------- ---------------
                                                                 ($ in thousands, except share
                                                                    and per share amounts)
Revenues
     <S>                                                           <C>             <C>
   Net premiums earned (primarily with related parties -
    See note 3)                                                    $    46,596     $        --
   Commission income (primarily with related parties -
    See note 3)                                                          1,561              --
   Net investment income                                                 5,791              --
   Net realized gain on investment                                           6              --
                                                                --------------- ---------------
     Total revenues                                                     53,954              --
                                                                --------------- ---------------
Expenses
  Loss and loss adjustment expenses (primarily with related
   parties - See note 3)                                                25,326              --
  Commission and other acquisition expenses (primarily with
   related parties - See note 3)                                        16,573              --
  Other operating expenses                                               3,336             436
  Interest expense                                                       2,201              --
                                                                --------------- ---------------
      Total expenses                                                    47,436             436
                                                                --------------- ---------------
Income (loss) before income taxes                                        6,518            (436)
Income tax benefit                                                         553              --
                                                                --------------- ---------------
Net income (loss)                                                  $     7,071     $      (436)
                                                                =============== ===============

Comprehensive Income (Loss)
  Net income(loss)                                                 $     7,071     $      (436)
  Other comprehensive income:
     Gross unrealized investment holding gains arising
      during period                                                        715              --
      Less: reclassification adjustment for gains included in
       net income                                                            6              --
                                                                --------------- ---------------
                                                                           709              --
     Income tax expense related to items of other
      comprehensive income                                                 (28)             --
                                                                --------------- ---------------
     Total other comprehensive income                                      681              --
                                                                --------------- ---------------
        Comprehensive Income (loss)                                $     7,752     $      (436)
                                                                =============== ===============

Earnings (Loss) Per Share
  Basic earnings (loss) per common share                           $      0.23     $     (0.29)
                                                                =============== ===============
  Diluted earnings (loss) per common share                         $      0.23     $     (0.29)
                                                                =============== ===============

Weighted Average Common Shares Outstanding:
  Basic                                                             30,421,659       1,504,842
  Diluted                                                           30,570,021       1,504,842


         See accompanying notes to the consolidated financial statements

</TABLE>


                                       3
<PAGE>

<TABLE>
<CAPTION>

                         CastlePoint Holdings, Ltd.
                      Consolidated Statements of Cash Flows
                                   (Unaudited)

                                                                       Three Months Ended
                                                                            March 31,
                                                                        2007          2006
                                                                  ------------- -------------
                                                                       ($ in thousands)
Cash flows from operating activities:
      <S>                                                                <C>       <C>
 Net income (loss)                                                   $   7,071     $    (436)
 Adjustments to reconcile net income to net cash provided by
  (used in) operations:
   Gain on sale of investments                                              (6)           --
   Depreciation and amortization                                            23            --
   Amortization of bond premium or discount                               (123)           --
   Amortization of stock-based compensation expense                        356            --
   Amortization of deferred financing fees                                  26            --
   Deferred income taxes                                                  (553)           --
Increase in assets:
   Accrued investment income                                              (662)           --
   Assumed premiums receivable                                          (7,604)           --
   Premiums receivable - programs                                         (699)           --
   Deferred acquisition costs                                           (8,243)           --
   Other assets                                                         (3,237)       (1,017)
Increase in liabilities:
   Loss and loss adjustment expenses                                    19,921             -
   Unearned premium                                                     25,300             -
   Assumed losses payable                                                1,897             -
   Premiums' payable - programs                                            729             -
   Accounts payable and accrued expenses                                  (509)            -
   Other liabilities                                                       340         1,454
                                                                  ------------- -------------
Net cash flows provided by operations                                   34,027            --
                                                                  ------------- -------------

Cash flows from investing activities:
Cost of fixed assets purchased                                             (98)           --
Purchases of investments:
   Cost of fixed-maturity securities purchased                        (212,164)           --
Sale of investments:
   Proceeds from sales of fixed-maturity securities                     97,818            --
   Other investments                                                    40,000            --
Net short term investments sold                                         49,887            --
                                                                  ------------- -------------
   Net cash flows used in investing activities                         (24,557)           --
                                                                  ------------- -------------

Cash flows from financing activities:
   Net proceeds from Tower Group, Inc.                                      --        15,000
   Net proceeds from initial public offering                           114,900            --
   Deferred financing fees                                                 (34)           --
   Dividends to shareholders                                              (740)           --
                                                                  ------------- -------------
   Net cash flows provided by financing activities                     114,126        15,000
                                                                  ------------- -------------

Increase in cash and cash equivalents                                  123,596        15,000
   Cash and cash equivalents, beginning of period                       34,784            --
                                                                  ------------- -------------
   Cash and cash equivalents, end of period                          $ 158,380     $  15,000
                                                                  ============= =============
Supplemental disclosures of cash flow information:
   Cash paid for income taxes                                        $      --     $      --
   Cash paid for interest                                            $   1,836     $      --


         See accompanying notes to the consolidated financial statements

</TABLE>


                                       4
<PAGE>

<TABLE>
<CAPTION>
                                          CastlePoint Holdings , Ltd.
                           Consolidated Statement of Changes in Shareholders' Equity
                                      for the period ended March 31, 2007
                                               ($ in thousands)
                                                                  Accumulated
                                                    Additional       Other        Retained          Total
                                         Common      Paid-In     Comprehensive    Earnings       Shareholders'
                                         Shares      Capital         Income       (deficit)         Equity
                                      ----------- ------------- --------------- ------------- -----------------
       <S>                                 <C>           <C>              <C>         <C>             <C>
Balance at December 31, 2006                $296      $269,472          $1,657        $8,288          $279,713
                                      =========== ============= =============== ============= =================

Initial public offering, net proceeds         87       113,886                                         113,973
Net income                                                                             7,071             7,071
Net unrealized gains                                                       680                             680
Stock based compensation                                   356                                             356
Dividends to shareholders                                                               (740)             (740)
                                      ----------- ------------- --------------- ------------- -----------------
Balance at March 31, 2007                   $383      $383,714          $2,337       $14,619          $401,053
                                      =========== ============= =============== ============= =================

                        See accompanying notes to the consolidated financial statements

</TABLE>


                                       5
<PAGE>

                           CastlePoint Holdings, Ltd.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

Note 1 - Basis of Presentation

         The accompanying unaudited consolidated financial statements have been
prepared in accordance with instructions for Form 10-Q and in conformity with
Article 10 of Regulation S-X. Accordingly, the accompanying consolidated
financial statements do not include all of the information and footnote
disclosures required by generally accepted accounting principles ("GAAP") in the
United States of America. These statements should be read in conjunction with
the consolidated financial statements as of and for the year ended December 31,
2006 and notes thereto included in the Registration Statement on Form S-1 (File
No. 333-139939) of the Company relating to the initial public offering of its
common shares, initially filed with the SEC on January 11, 2007, as amended (as
so amended, the "Registration Statement"). The accompanying consolidated
financial statements have not been audited by an independent registered public
accounting firm in accordance with standards of the Public Company Accounting
Oversight Board (United States), but in the opinion of management such financial
statements include all adjustments, consisting only of normal recurring
adjustments, necessary for a fair presentation of the Company's financial
position and results of operations. The results of operations for the three
months ended March 31, 2007 may not be indicative of the results that may be
expected for the year ending December 31, 2007. The consolidated financial
statements include the accounts of CastlePoint Holdings, Ltd. (sometimes
referred to as "CastlePoint Holdings" or the "Company"), its wholly owned
subsidiaries, CastlePoint Bermuda Holdings Ltd. ("CastlePoint Bermuda
Holdings"), CastlePoint Reinsurance Company, Ltd. ("CastlePoint Re"),
CastlePoint Management Corp. ("CastlePoint Management") and CastlePoint
Insurance Company ("CastlePoint Insurance"). All significant inter-company
balances have been eliminated. Business segment results are presented net of all
material inter-segment transactions.

Note 2 - Initial Public Offering

         On March 28, 2007 we completed the sale of 8,697,148 common shares at
$14.50 in a firm commitment underwritten initial public offering. In addition,
119,500 shares were sold in that offering by selling shareholders who previously
purchased such shares in the private offering of our common shares we completed
in April 2006. Included in the 8,697,148 shares sold by us were 1,134,410 shares
purchased by the underwriters to cover over-allotments. The net proceeds to the
Company of the initial public offering were approximately $114 million after the
deduction of underwriting discounts and other estimated offering expenses.

         The common shares of CastlePoint Holdings are listed on the Nasdaq
Global Market under the symbol "CPHL."

Note 3 - Related Party Transactions

         The Company and/or its subsidiaries are parties to a master agreement,
certain reinsurance agreements, program management agreements and service and
expense sharing agreements with Tower Group, Inc., a Delaware corporation that
is publicly traded in the U.S. ("Tower") or its insurance subsidiaries. In
addition, CastlePoint Re participates as a reinsurer of Tower's property and
excess of loss reinsurance agreements. CastlePoint Re entered into three
multi-year quota share reinsurance agreements with Tower's insurance
subsidiaries: the brokerage business quota share reinsurance agreement, the
traditional program business quota share reinsurance agreement, and the
specialty program business and insurance risk-sharing business quota share
reinsurance agreement. Under the brokerage business quota share reinsurance
agreement, during the three months ended March 31, 2007, Tower's insurance
companies ceded to CastlePoint Re 49% of each of their brokerage business. There
were no changes during the three months ended March 31, 2007 to our arrangements
with Tower pursuant to the traditional program business quota share reinsurance
agreement and the specialty program business and insurance risk-sharing business
quota share reinsurance agreement. Premiums receivable from and losses payable
to Tower as of March 31, 2007 were $40.1 million and $3.6 million, respectively
compared to $42.4 million and $3.5 million as of December 31, 2006. The unearned
premium reserves and loss reserves with Tower as of March 31, 2007 were $95.0
million and $48.6 million, respectively, compared to $80.7 million and $33.2
million as of December 31, 2006. Deferred acquisition costs were $32.8 million

                                       6
<PAGE>


and $28.0 million as of March 31, 2007 and December 31, 2006, respectively. The
total underwriting impact related to our reinsurance agreements with Tower
discussed above is as follows:

                                                               March 31, 2007
                                                         -----------------------
                                                              ($ in thousands)
Net premiums earned.....................................             $38,533
Net losses incurred.....................................              20,554
Net commission expense..................................              13,218

         CastlePoint Management is a party to service and expense sharing
agreements with Tower and certain of its subsidiaries. Tower charged CastlePoint
Management $144,489 for the period ended March 31, 2007 for services rendered in
support of CastlePoint Management's infrastructure as contemplated by the
service and expense sharing agreements.

         CastlePoint Management is a party to program management agreements with
Tower, whereby CastlePoint Management was appointed to perform certain
underwriting and claims services with respect to program business. Premiums
collected and due to Tower for program business at March 31, 2007 were $1.8
million. At March 31, 2007, CastlePoint Management recorded commission revenue
of $1.6 million from Tower. For services rendered in support of CastlePoint
Management's program business as contemplated by the service and expense sharing
agreements, Tower charged CastlePoint Management $53,660 for the period ended
March 31, 2007.

Note 4 - Investments

         The amortized cost and fair value of the investments by investment type
as of March 31, 2007 and December 31, 2006 are as follows:
<TABLE>
<CAPTION>

                                               Cost or         Gross Unrealized    Gross Unrealized     Estimated Fair
                                            Amortized Cost          Gains                Losses             Value
                                           -----------------  -------------------  -------------------  -----------------
                                                                           ($ in thousands)
March 31, 2007:
Bonds:
   <S>                                               <C>                  <C>                  <C>                <C>
US government and agencies securities               $25,947                 $ 14               $  (9)           $ 25,952
Corporate fixed maturities                          109,478                  682                  (8)            110,152
Mortgage and asset-backed securities                272,931                1,845                (154)            274,622
                                           -----------------  -------------------  -------------------  -----------------
    Total fixed maturities                          408,356                2,541                (171)            410,726
Short term investments                                1,751                    0                    0              1,751
                                           -----------------  -------------------  -------------------  -----------------
Total available-for-sale investments                410,107                2,541                (171)            412,477


December 31, 2006:
Bonds:
US government and agencies securities              $ 18,650                 $ 19               $ (10)           $ 18,659
Corporate fixed maturities                           88,785                  398                 (22)             89,161
Mortgage and asset-backed securities                186,443                1,342                 (78)            187,707
                                           -----------------  -------------------  -------------------  -----------------
    Total fixed maturities                          293,878                1,759                (110)            295,527
Short term investments                               51,626                   12                    0             51,638
                                           -----------------  -------------------  -------------------  -----------------
Total available-for-sale investments                345,504                1,771                (110)            347,165

</TABLE>

                                       7
<PAGE>


         The Company accounts for its investments in marketable securities in
accordance with Statement of Financial Accounting Standards No. 115, "Accounting
for Certain Investments in Debt and Equity Securities" ("SFAS 115"), which
requires that fixed-maturity and equity securities that have readily determined
fair values be segregated into categories based upon the Company's intention for
those securities. In accordance with SFAS 115, the Company has classified its
fixed-maturity and equity securities as available-for-sale. The Company may sell
its available-for-sale securities in response to changes in interest rates,
risk/reward characteristics, liquidity needs or other factors.

         Fixed-maturity securities are reported at their estimated fair values
based on quoted market prices or a recognized pricing service, with unrealized
gains and losses, net of tax effects, reported as a separate component of
comprehensive income in shareholders' equity. Realized gains and losses are
determined on the specific identification method.

Redemption of Tower Non-Cumulative Convertible Redeemable Perpetual Preferred
Stock

         On December 4, 2006, CastlePoint Management purchased 40,000 shares of
Series A non-cumulative convertible redeemable perpetual preferred stock (as
subsequently exchanged for a new series of such convertible perpetual preferred
stock reflecting substantially similar terms, the "perpetual preferred stock")
of Tower, for an aggregate consideration of $40 million. CastlePoint Management
completed such purchase pursuant to an assignment by CastlePoint Re of its
related obligations under a stock purchase agreement CastlePoint Re entered into
with Tower in November 2006.

         Tower redeemed all of its perpetual preferred stock held by CastlePoint
Management on January 26, 2007, at the redemption price of $40 million in the
aggregate plus approximately $0.3 million in interest that was paid in January
2007. We used the proceeds of such redemption to further capitalize CastlePoint
Insurance. Although Tower effected such redemption, we retained the right of
first refusal from Tower, with respect to any insurance companies Tower may
acquire during the term of our master agreement, subject to the receipt of any
necessary regulatory approvals, to assume such companies' historical losses
pursuant to a loss portfolio transfer agreement (which must be on mutually
acceptable market competitive terms) if Tower desires to cause these insurance
companies to effect loss portfolio transfers. In the case of Tower's acquisition
of Preserver Group, Inc., a privately held company that specializes in small
commercial and personal lines insurance in the northeastern region of the United
States ("Preserver"), which Tower announced it completed in April 2007, Tower
has not notified us that it intends to effect a loss portfolio transfer from
Preserver. Although Tower redeemed its perpetual preferred stock, the benefit of
a one-year extension of the initial three-year terms of our agreements with
Tower remains in effect.

Note 5 - Accounting Pronouncements

         In February 2006, the Financial Accounting Standards Board (FASB)
issued SFAS No.155, "Accounting for Certain Hybrid Financial Instruments, an
amendment of SFAS No.133 and SFAS No.140" (SFAS 155) and Statement 133
Implementation Issue No. B40, "Embedded Derivatives: Application of Paragraph 13
(b) Securitized Interests in Prepayable Financial Assets" ("B40"). B40 provides
a narrow scope exception for certain securitized interests from the tests
required under paragraph 13 (b) of SFAS No. 133. SFAS 155 is effective for all
financial instruments acquired or issued after January 1, 2007. B40, under
specific criteria, is effective July 1, 2007. SFAS 155 provides entities with
relief from having to separately determine the fair value of an embedded
derivative that would otherwise be required to be bifurcated from its host
contract in accordance with SFAS 133. SFAS 155 allows an entity to make an
irrevocable election to measure such a hybrid financial instrument at fair value
in its entirety, with changes in fair value recognized in earnings. The election
may be made on an instrument-by-instrument basis and can be made only when a
hybrid financial instrument is initially recognized or when certain events occur
that constitute a remeasurement (i.e., new basis) event for a previously
recognized hybrid financial instrument. Adoption of SFAS 155 has not had a
material impact on the Company's consolidated financial condition or results of
operations. Management is still evaluating the provision of B40, which is not
effective until July 1, 2007.

         In June 2006, the FASB issued FIN No. 48, "Accounting for Uncertainty
in Income Taxes," an Interpretation of FASB Statement No. 109 ("FIN 48"). FIN 48

                                       8
<PAGE>


is effective for fiscal years beginning after December 15, 2006. FIN 48 provides
an interpretation to SFAS 109 with respect to the recognition and measurement of
tax uncertainties. Specifically, it prescribes a recognition threshold and a
measurement attribute for the financial statement recognition and measurement
for uncertain tax positions taken or expected to be taken in income tax returns.
The Company is to determine whether it is "more likely than not" (i.e., greater
than 50% certain) that our position would be sustained upon examination by tax
authorities. Tax positions that meet the "more likely than not" threshold are
then measured using a probability weighted approach recognizing the largest
amount of tax benefit that is greater than a 50% likelihood of being realized
upon ultimate settlement. The adoption of FIN 48 has not had a material impact
on the Company's consolidated financial condition or results of operations.
Interest on underpayment of taxes will be shown on the Consolidated Statements
of Income and Comprehensive Income as "interest expense." Penalties accrued will
be classified as "other expense."

         In September 2006, the FASB issued SFAS No. 157 ("SFAS 157"), "Fair
Value Measurements". This new standard provides guidance for using fair value to
measure assets and liabilities. Under SFAS 157, fair value refers to the price
that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants in the market in which the
reporting entity transacts. In this standard, the FASB clarifies the principle
that fair value should be based on the assumptions market participants would use
when pricing the asset or liability. In support of the principle, SFAS 157
establishes a fair value hierarchy that prioritizes the information used to
develop those assumptions. The fair value hierarchy gives the highest priority
to quoted prices in active markets and the lowest priority to unobservable data
such as the reporting entity's own data. Under the standard, fair value
measurements would be separately disclosed by level within the fair value
hierarchy. The provisions of SFAS 157 are effective for financial statements
issued beginning November 15, 2007. The Company is currently reviewing the
impact that adoption of SFAS 157 will have on its consolidated financial
position and results of operations.

         In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option
for Financial Assets and Financial Liabilities" ("SFAS 159"). This statement
permits entities to choose to measure many financial instruments and certain
other items at fair value at specified election dates. The objective is to
improve financial reporting by providing the entities with the opportunity to
mitigate volatility in reported earnings caused by measuring related assets and
liabilities differently without having to apply complex hedge accounting
provisions. This standard also establishes presentation and disclosure
requirements designed to facilitate comparisons between entities that choose
different measurement attributes for similar types of assets and liabilities.
This statement is expected to expand the use of fair value measurement. The
standard is effective as of the beginning of an entity's first fiscal year that
begins after November 15, 2007. The Company is currently reviewing the impact
that adoption of SFAS 159 will have on its consolidated financial position and
results of operations.

Note 6 -Dividends Declared

         Dividends declared by the Company on its common shares for the three
months ended March 31, 2007 were $739,500, or $0.025 per share. There were no
dividends declared by the Company on its common shares for the three months
ended March 31, 2006.


                                       9
<PAGE>


Note 7 - Earnings (Loss)  Per Share

         The following table shows the computation of the Company's earnings per
share:

<TABLE>
<CAPTION>

                                    Income (Loss)          Shares           Per Share
                                     (Numerator)       (Denominator)          Amount
                                 -------------------- ---------------- --------------------
                                   ($ in thousands, except shares and per share amounts)
 <S>                                        <C>              <C>               <C>
Three Months Ended
March 31, 2007
Net Income                                    $7,071
                                 -------------------- ---------------- --------------------
Basic earnings per share                       7,071       30,421,659             $    .23
                                 -------------------- ---------------- ====================
Effect of dilutive securities:
  Warrants                                                    148,362
Diluted earnings per share                    $7,071       30,570,021             $    .23
                                 ==================== ================ ====================
Three Months Ended
March 31, 2006
Net Loss                                      $ (436)
                                 -------------------- ---------------- --------------------
Basic losses per share                          (436)       1,504,842              ($ 0.29)
                                 -------------------- ---------------- ====================
Diluted losses per share                      $ (436)       1,504,842              ($ 0.29)
                                 ==================== ================ ====================
</TABLE>

         Weighted average stock options outstanding of 1,136,611 for the three
months ended March 31, 2007 have been excluded where these were anti-dilutive to
the earnings per share, based on the weighted average fair value per share of
$11.52 being less than the sum of the exercise price and unrecognized
compensation cost. There were no stock options or warrants outstanding as of
March 31, 2006.

Note 8 -Employee Stock Option Plan

         The Company adopted the provision of SFAS No. 123-R effective January
1, 2006 and granted all of its stock options after that date. The compensation
cost of awards will be based on the grant-date value of those awards as
calculated under SFAS No. 123-R and amortized over the vesting period. The
Company's 2006 Long-Term Equity Compensation Plan (the "Plan") provides for
grants of any option, stock appreciation right ("SAR"), restricted share,
restricted share unit, performance share, performance unit, dividend equivalent
or other share-based award. The total number of shares reserved for issuance
under the Plan is 1,735,021 common shares, of which 1,126,166 options were
issued to senior management and non-employee directors of the Company and its
subsidiaries in 2006, and 539,447 options were issued to non-employee directors
and certain officers and employees of the Company and its subsidiaries during
the three months ended March 31, 2007. The Plan is administered by the
Compensation Committee of the Board of Directors of the Company. The stock
options granted to employees vest in installments over 42 months of service and
the stock options granted to non-employee directors vest after 12 months of
service. No SARs have been granted to date. Each of the Company's three current
non-employee directors received 1,724 restricted common shares in 2007.

         As of March 31, 2007, there was $5.7 million of unrecognized
compensation costs related to 1,622,113 non-vested stock options. For employees,
the cost is expected to be recognized over the vesting periods of the individual
options which extend to 42 months. For non-employee directors, the cost is
expected to be recognized over the vesting period of 12 months. For the three
months ended March 31, 2007, the Company recognized $0.4 million of compensation
expense related to share-based compensation.


                                       10
<PAGE>

<TABLE>
<CAPTION>

                                                                March 31, 2007
                                                      -----------------------------------
                                                                             Weighted
                                                                         Average Exercise
                                                      Number of Shares        Price
                                                      ----------------   ----------------

<S>                                                   <C>                <C>
Outstanding, beginning of period                             1,082,666   $          10.00
Granted at market value                                        539,447              14.50
Forfeitures and expirations                                         --                 --
Exercised                                                           --                 --
Outstanding, end of period                                   1,622,113   $          11.50
Exercisable, end of period                                          --                 --
Weighted average fair value per share of
options granted                                                                      4.81


  Options outstanding as of March 31, 2007 are shown on the following schedule:

</TABLE>

<TABLE>
<CAPTION>

                                                      Average Remaining      Average Exercise
                               Number of Shares        Contractual Life           Price
                             --------------------- ----------------------- -------------------
Exercise Prices
<C>                          <C>                    <C>                    <C>
$10.00                                  1,082,666              9.0  years  $            10.00
$14.50                                    539,447             10.0  years  $            14.50
                             --------------------- ----------------------- -------------------
Total Options                           1,622,113             9.33  years  $            11.50
                             ===================== ======================= ===================

</TABLE>

Note 9 -Reserves

  The components of the liability for loss and loss adjustment expenses as of
                         March 31, 2007 are as follows:

                                                             Gross Liability
                                                             ----------------
                                                             ($ in thousands)
Case-basis reserves......................................... $         21,966
IBNR reserves............................................... $         32,147
                                                             ----------------
Total....................................................... $         54,113
                                                             ================


       Activity in the liability for loss and loss adjustment expenses is
                             summarized as follows:



                                                            March 31, 2007
                                                           ---------------
                                                           ($ in thousands)

Balance at January 1, 2007                                 $        34,192

Incurred related to:
Current year                                                        24,794
Prior years                                                            532
                                                           ---------------
Total incurred                                                      25,326
Paid and payable:
Current year                                                            --
Prior years                                                          5,405
                                                           ---------------
Total paid and payable                                               5,405

Balance at March 31, 2007                                  $        54,113
                                                           ===============


                                       11
<PAGE>

         Loss and loss adjustment expenses were $25.3 million, which produced a
54.3% loss ratio for the three months ended March 31, 2007. During the same
period in 2007, Tower's brokerage business quota share loss ratio was 52.5%. We
experienced a $0.5 million unfavorable case development on accident year 2006
primarily as a result of one large loss incurred in a specialty program.


Note 10 - Segment Information

         The Company reports its results in three business segments:
reinsurance, insurance and insurance services. The insurance segment did not
conduct any business and did not have any premium income, obligations relating
to insurance policies, employees and operations for the three months ended March
31, 2007. The reinsurance segment includes the results from the reinsurance
business written through CastlePoint Re. The insurance services segment includes
the results from managing the program business. The insurance services segment
will include results from providing unbundled insurance services to program
underwriting agents, although no such services were provided for the three
months ended March 31, 2007.

         The Company evaluates segment performance based on segment profit,
which excludes investment income, realized gains and losses, general corporate
expenses, interest expenses, income taxes and any other non-core business income
or expenses.

                                                 Three Months Ended March 31,
                                                -------------------------------
                                                     2007             2006
                                                --------------   --------------
                                                        ($ in thousands)
Insurance Segment  Information
Revenues:                                       $           --   $           --
Net premiums earned...........................              --               --
                                                --------------   --------------
Total revenues................................              --               --
                                                --------------   --------------
Expenses:
Underwriting expenses.........................               2               --
                                                --------------   --------------
Total expenses................................               2               --
                                                --------------   --------------
Segment loss .................................  $           (2)            $ --
                                                ==============   ==============



                                                 Three Months Ended March 31,
                                                -------------------------------
                                                     2007            2006
                                                --------------   --------------
                                                       ($ in thousands)
Reinsurance Segment
Revenues:
Net premiums earned ..........................  $       46,596   $           --
                                                --------------   --------------
Total revenues ...............................          46,596               --
                                                --------------   --------------
Expenses:
Net loss and loss adjustment expenses ........          25,326               --
Commission expenses ..........................          15,357               --
                                                --------------   --------------
Other underwriting expenses ..................             650              104
                                                --------------   --------------
Total expenses ...............................          41,333              104
                                                --------------   --------------
Segment profit (loss) ........................  $        5,263   $         (104)
                                                ==============   ==============


                                       12
<PAGE>
<TABLE>
<CAPTION>
<S>                                                                                         <C>                       <C>

                                                                                               Three Months Ended March 31,
                                                                                               ----------------------------
                                                                                            2007                      2006
                                                                                           -------                 --------
                                                                                                      ($ in thousands)
Insurance Services Segment
Revenues:
Direct commission revenue from program business.................................            $1,561                    $ --
                                                                                            ------                    ----
Total revenues..................................................................             1,561                      --
                                                                                            ------                    ----
Expenses:
Direct commission expenses from program business................................             1,216                      --
Other insurance services expenses...............................................             1,344                      18
                                                                                            ------                    ----
Total expenses..................................................................             2,560                      18
                                                                                            ------                    ----
Segment loss....................................................................            $ (999)                  $ (18)
                                                                                            ======                   =====
</TABLE>

         The following table reconciles revenues by segment to consolidated
revenues:
<TABLE>
<CAPTION>
<S>                                                                                     <C>              <C>

                                                                                         Three Months Ended March 31,
                                                                                        ------------------------------
                                                                                             2007            2006
                                                                                        --------------   -------------
                                                                                               ($ in thousands)
Revenues:
 Insurance segment......................................................................$          --    $         --
 Reinsurance segment....................................................................       46,596              --
 Insurance services segment.............................................................        1,561              --
                                                                                        --------------   -------------
Total segment revenues..................................................................       48,157              --
                                                                                        --------------   -------------
Net Investment income...................................................................        5,791              --
Net realized capital gains..............................................................            6              --
                                                                                        --------------   -------------
Consolidated revenues...................................................................$      53,954    $         --
                                                                                        ==============   =============
</TABLE>

         The following table reconciles the results of the Company's individual
segments to consolidated income before taxes:

<TABLE>
<CAPTION>
<S>                                                                      <C>                  <C>
                                                                            Three Months Ended March 31,
                                                                         -----------------------------------
                                                                               2007                2006
                                                                         ----------------     --------------
                                                                                  ($ in thousands)
Insurance segment loss...................................................$            (2)     $          --
Reinsurance segment profit...............................................          5,263               (104)
Insurance services segment loss..........................................           (999)               (18)
                                                                         ----------------     --------------
Segment profit (loss)....................................................          4,262               (121)
Net investment income....................................................          5,791                 --
Net realized capital gains...............................................              6                 --
Corporate expenses.......................................................         (1,340)              (314)
Interest expense.........................................................         (2,201)                --
                                                                         ----------------     --------------
Income(loss) before taxes................................................$         6,518      $        (436)
                                                                         ================     ==============
</TABLE>

                                       13
<PAGE>

         The following table reconciles the assets of the Company's individual
segments to consolidated assets:
<TABLE>
<CAPTION>
<S>                                                                                     <C>            <C>
                                                                                          March 31,     December 31,
                                                                                        -------------- --------------
                                                                                             2007           2006
                                                                                        -------------- --------------
                                                                                              ($ in thousands)
Assets:
Insurance segment.......................................................................$      89,636  $       8,850
Reinsurance segment.....................................................................      452,399        395,414
Insurance services segment..............................................................       16,823         98,440
                                                                                        -------------- --------------
Total segment assets....................................................................      558,858        505,704
Corporate assets........................................................................      121,172          8,638
                                                                                        -------------- --------------
Consolidated assets.....................................................................$     680,030  $     511,342
                                                                                        ============== ==============
</TABLE>

Note 11 - Trust Agreements

         Under the terms of the quota share reinsurance agreements between
CastlePoint Re and Tower's insurance companies, CastlePoint Re is required to
provide security to Tower's insurance companies to support reinsurance
recoverables owed to these reinsureds in a form acceptable to the insurance
commissioners of the State of New York and Commonwealth of Massachusetts, the
domiciliary states of Tower's insurance companies. This trust arrangement
permits Tower's insurance companies to take credit on their statutory financial
statements for the reinsurance ceded to CastlePoint Re, either as an additional
asset or as a reduction in liability. CastlePoint Re is also required by its
reinsurance agreements with its other cedents to collateralize amounts through a
letter of credit, cash advance, funds held or a trust account meeting the
requirements of the applicable state insurance regulations.

         As of March 31, 2007, CastlePoint Re had trust accounts for the benefit
of its reinsureds totaling approximately $133.3 million, an increase of
approximately $28.9 million since December 31, 2006. CastlePoint Re earns and
collects the interest on the trust funds.

Note 12 - Subsequent Events

         The Board of Directors of CastlePoint Holdings has approved a quarterly
dividend of $0.025 per share payable June 27, 2007 to the Company's shareholders
of record as of June 15, 2007.

         The New York State Insurance Department has not yet approved the
pooling agreements and related pool management agreements between Tower and
CastlePoint Insurance that were to take effect as of January 1, 2007. We
continue to seek regulatory approvals of these agreements.

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

Note on Forward-Looking Statements

         Some of the statements in this quarterly report, including without
limitation, in the section entitled "Management's Discussion and Analysis of
Financial Condition and Results of Operations," including those using words such
as "believes," "expects," "intends," "estimates," "projects," "predicts,"
"assumes," "anticipates," "plans" and "seeks," and comparable terms, are
forward-looking statements. Forward-looking statements are not statements of
historical fact and reflect our views and assumptions as of the date of this
quarterly report regarding future events and operating performance. Because we
have a very limited operating history, many statements relating to us and our
business, including statements relating to our competitive strengths and
business strategies, are forward-looking statements.

         All forward-looking statements address matters that involve risks and
uncertainties. Accordingly, there are important factors that could cause our
actual results to differ materially from those indicated in these statements. We
believe that these factors include, but are not limited to, the risk factors
identified in our Registration Statement filed with the SEC and the following:

                                       14
<PAGE>

     o    our lack of any meaningful operating history and our inability to
          start engaging in the insurance business because we have not received
          regulatory approval or executed some of the transactions described in
          this quarterly report and/or in our other filings with the SEC;

     o    our heavy dependence on Tower for revenue in our initial years of
          operation, and possibly beyond, and the continued growth of Tower's
          business, including as a result of its acquisition of Preserver in
          April 2007, in the future consistent with Tower's past growth;

     o    the risk that CastlePoint Bermuda Holdings or CastlePoint Holdings may
          be deemed to be engaged in a U.S. trade or business, or CastlePoint Re
          may be considered to be doing business through a permanent
          establishment in the U.S., either of which would subject these
          companies to U.S. taxation, which could have a material adverse effect
          on our business, financial condition and results of operations;

     o    the terms of our arrangements with Tower may change as a result of the
          regulatory review and approval process;

     o    Preserver's ability to write premiums consistent with its historical
          results;

     o    our ability to write premiums with clients other than Tower;

     o    the possibility that we may need additional capital to further
          capitalize CastlePoint Re and CastlePoint Insurance for our
          reinsurance business and insurance business, respectively, as well as
          at least one additional broadly licensed U.S. insurance company for
          our insurance business, and to make strategic investments in some of
          our clients, including Tower, and the risk that we may not be able to
          obtain future financing on favorable terms or at all;

     o    our ability to hire, retain and integrate our management team and
          other personnel;

     o    the risk that we may not be able to implement our business strategy;

     o    the ineffectiveness or obsolescence of our planned business strategy
          due to changes in current or future market conditions;

     o    changes in regulation or tax laws applicable to us, our brokers or our
          customers;

     o    changes in the availability, cost or quality of insurance business
          that meets out reinsurance underwriting standards;

     o    actual results, changes in market conditions, the occurrence of
          catastrophic losses and other factors outside our control that may
          require us to alter our anticipated methods of conducting our
          business, such as the nature, amount and types of risk we assume and
          the terms and limits of the products we intend to write;

     o    inability of any additional U.S. licensed insurance companies that we
          may acquire to obtain expected ratings from A.M. Best;

     o    possible future downgrade in the rating of CastlePoint Re, CastlePoint
          Insurance or our U.S. licensed insurance companies;

     o    changes in rating agency policies or practices;

     o    changes in accounting policies or practices; and

     o    changes in general economic conditions, including inflation, foreign
          currency exchange rates, interest rates and other factors.

                                       15
<PAGE>

         This list of factors is not exhaustive and should be read with the
other cautionary statements that are included in this quarterly report.

         If one or more of these or other risks or uncertainties materialize, or
if our underlying assumptions prove to be incorrect, actual results may vary
materially from our projections. Any forward-looking statements you read in this
quarterly report reflect our current views with respect to future events and are
subject to these and other risks, uncertainties and assumptions relating to,
among other things, our operations, results of operations, growth strategy and
liquidity. All subsequent written and oral forward-looking statements
attributable to us or individuals acting on our behalf are expressly qualified
in their entirety by this paragraph. All investors and potential investors in
our common shares should specifically consider the factors identified in this
quarterly report and the risk factors identified in our Registration Statement
filed with the SEC that could cause actual results to differ from those
discussed in the forward-looking statements before making an investment
decision. We undertake no obligation to publicly update or review any
forward-looking statement, whether as a result of new information, future events
or otherwise.

Critical Accounting Estimates

         The Company's consolidated financial statements and the related
disclosures included in this quarterly report have been prepared in accordance
with U.S. GAAP. The preparation of financial statements in accordance with U.S.
GAAP requires management to make estimates and assumptions that affect reported
and disclosed amounts of assets and liabilities, as well as disclosure of
contingent assets and liabilities as at the balance sheet date and the reported
amounts of revenues and expenses during the reporting period. We believe the
following accounting policies are critical to our operations, as their
application requires management to make the most significant judgments. We
believe the items that require the most subjective and complex estimates are:

     o    premiums;
     o    losses and loss adjustment expense reserves;
     o    deferred acquisition costs;
     o    investments;
     o    reinsurance accounting;
     o    deferred taxes; and
     o    U.S. taxation.

         Of the items mentioned above, management believes that a discussion of
premiums, losses and loss adjustment expense reserves, deferred tax and U.S.
taxation is appropriate in this quarterly report due to the developments that
occurred during the first quarter of 2007. More information regarding our other
critical accounting estimates is included in the section entitled "Critical
Accounting Estimates" in the "Management Discussion and Analysis of Financial
Condition and Results of Operations" included in the Registration Statement.

         Regarding premium estimates, while we attempt to obtain current assumed
premiums written statements from ceding companies, it is common that the most
recent month statements are not received from the ceding company until after the
period ending and, in some cases, the most recent quarter. Therefore, assumed
premiums written from these ceding companies are estimated for the most recent
month or, in some cases, for several months. With respect to CastlePoint Re's
three quota share reinsurance agreements with Tower's insurance companies, we
obtain current monthly statements and assumed premiums written from Tower on an
actual, rather than estimated, basis. For ceding companies from which we have
not received current monthly statements and therefore must estimate the most
recent period's assumed premiums written, the difference between the estimated
assumed premiums written and actual assumed premiums written is reflected in the
subsequent accounting period or as soon as the actual assumed premiums written
are obtained. For our most recent quarter ended March 31, 2007, approximately
21% of the assumed written premiums and approximately 12% of the corresponding
assumed earned premiums are based upon premium estimates. After provision for
applicable loss and loss adjustment expenses and commission and other
acquisition expenses, the impact of these estimates would not have a material
effect on the Company's consolidated financial position or results of
operations.

                                       16
<PAGE>

         Regarding loss and loss adjustment expense estimates, changes in loss
reserves estimates may result from (1) variability in the estimation process
itself, and (2) the fact that external factors may cause changes in the future
that are not reflected in historical patterns. With respect to the former source
of variability, i.e. estimation process variation, we believe that a reasonably
likely range for the loss reserves can be represented by a standard utilized by
some professional, independent actuaries as part of their certification of an
insurer's reserves. That standard contemplates that the company's loss reserves
must be in a range from minus 5% to plus 10% of the independent actuary's best
estimate. Utilizing this standard as a guide, we believe that most professional
actuaries, assuming they are presented with the same information, would
determine that the loss reserves can be certified if they fall within a range of
minus 5% to plus 10%. Therefore, it is reasonably likely that some professional
actuaries, assuming they are presented with the same information relating to our
company, would determine a best estimate of our loss reserves to be between
$51.4 million and $59.5 million as of March 31, 2007, as compared to our own
best estimate of the loss reserves, which is $54.1 million as of that date. No
assurance can be given that outcomes outside of the above range cannot occur, as
outcomes outside of such range are possible. In addition, the above range
assumes that future patterns are similar to historical patterns, as to which
there can be no assurance. With regard to the potential variability in loss
reserves estimates due to the fact that future patterns may differ from
historical patterns, we believe there is additional potential variability that
cannot be estimated.

         The deferred tax asset at March 31, 2007 was $1.6 million, which was
comprised of the cost of stock options and CastlePoint Management's net loss. In
assessing the valuation of deferred tax assets, we consider whether it is more
likely than not that some portion or all the deferred tax will be realized. The
ultimate realization of deferred tax assets is dependent upon the generation of
future taxable income to offset previous operating losses or during periods in
which temporary differences become deductible. Our management currently believes
that it is more likely than not that we will recover all of the assets based
primarily upon future profitability of our U. S. operations.

         Regarding U.S. taxation, if either CastlePoint Bermuda Holdings or
CastlePoint Holdings are deemed by the U.S. Internal Revenue Service to be
engaged in a U.S. trade or business, or if CastlePoint Re is considered to be
doing business through a permanent establishment in the U.S., then these
entities would be subject to U.S. taxation. FIN No. 48 prescribes a recognition
threshold and a measurement attribute for the financial statement recognition
and measurement for uncertain tax positions taken or expected to be taken in
income tax returns. The Company is to determine whether it is "more likely than
not" (i.e., greater than 50% certain) that our position would be sustained upon
examination by tax authorities. Tax positions that meet the "more likely than
not" threshold are then measured using a probability weighted approach
recognizing the largest amount of tax benefit that is greater than a 50%
likelihood of being realized upon ultimate settlement. The adoption of FIN 48
has not had a material impact on the Company's consolidated financial position
or results of operations.

                                       17
<PAGE>

Consolidated Results of Operations
<TABLE>
<CAPTION>
<S>                                                                       <C>                  <C>
                                                                                Three Months Ended March 31,
                                                                          ----------------------------------------
                                                                                 2007                 2006
                                                                          -------------------  -------------------
                                                                                      ($ in thousands)
Revenues
Net premiums earned                                                       $           46,596   $               --
                                                                          -------------------  -------------------
Commission income                                                                      1,561                   --
Net investment income                                                                  5,791                   --
Net realized investment gains                                                              6                   --
                                                                          -------------------  -------------------
Total revenues                                                                        53,954                   --
                                                                          -------------------  -------------------
Expenses
Net loss and loss adjustment expenses                                                 25,326                   --
Commission and other acquisition expenses                                             16,573
Other operating expenses                                                               3,336                  436
Interest expenses                                                                      2,201                   --
                                                                          -------------------  -------------------
Total expenses                                                                        47,436                  436
                                                                          -------------------  -------------------
Income before taxes                                                                    6,518                 (436)
Income tax benefit                                                                       553                   --
                                                                          -------------------  -------------------
Net Income/(Loss)                                                         $            7,071   $             (436)
                                                                          ===================  ===================
Key Measures
Return on average equity                                                                 9.6%
Consolidated combined ratio                                                             93.7%
</TABLE>


         We calculate our loss and expense ratios by segment. See "--Insurance
Segment Results of Operations," "--Reinsurance Segment Results of Operations"
and "--Insurance Services Segment Results of Operations" below.

Consolidated Results of Operations for the Three Months Ended March 31, 2007 and
2006

         For the three months ended March 31, 2006, we did not have any
insurance or reinsurance written premiums or losses. We incurred operating
expenses of $0.4 million for the three months ended March 31, 2006 relating to
our start up activities.

         Total revenues. Total revenues were $54.0 million for the three months
ended March 31, 2007, which consisted of net premiums earned (86.4% of the total
revenues), commission income (2.9% of the total revenues) and net investment
income (10.7% of the total revenues).

         Premiums earned. Net premiums earned were $46.6 million for the three
months ended March 31, 2007. The business assumed by CastlePoint Re under its
reinsurance agreements with Tower's insurance companies represented 81% of net
premiums earned.

         Commission income. Commission income was $1.5 million for the three
months ended March 31, 2007. We received this commission income as a result of
CastlePoint Management's management of the specialty and traditional programs.

         Net investment income and realized investment gains. Net investment
income was $5.8 million for the three months ended March 31, 2007. The
investment book yield on our invested assets was 5.41% for the three months
ended March 31, 2007.

         Loss and loss adjustment expenses. Loss and loss adjustment expenses
were $25.3 million, which produced a 54.3% loss ratio for the three months ended
March 31, 2007. The quota share loss ratio of Tower's brokerage business was
52.5 % during the same period.

                                       18
<PAGE>

         Expenses. Commission and operating expenses were $19.9 million for the
three months ended March 31, 2007, and were comprised of commission expense of
$16.6 million and other operating expenses of $3.3 million, including corporate
expenses (namely, salaries, audit, legal services and insurance expenses).

         Interest expense. Our interest expense was $2.2 million for the three
months ended March 31, 2007. Interest expense resulted from the $103.1 million
of subordinated debentures issued by us in December 2006 at a fixed interest
rate.

         Net income (loss) and return on average equity. Our net income was $7.1
million for the three months ended March 31, 2007. Our annualized return on
average equity was 9.6% for the three months ended March 31, 2007. The
annualized return was calculated by dividing annualized net income of $28.3
million by weighted average shareholders' equity of $294.8 million.

         Consolidated combined ratio. One of our key measures of profitability
is what we refer to as our consolidated combined ratio, which is calculated by
(i) dividing the total expenses (excluding interest expenses) minus commission
income by (ii) net premiums earned. Our consolidated combined ratio for the
first quarter of 2007 was 93.7%.

Insurance Segment Results of Operations
<TABLE>
<CAPTION>
<S>                                                                       <C>                     <C>
                                                                               Three Months Ended March 31,
                                                                          ---------------------------------------
                                                                               2007                    2006
                                                                          ---------------         ---------------
                                                                                     ($ in thousands)
Revenues
Premiums earned
   Gross premiums earned                                                  $           --          $           --
   Less: ceded premiums earned                                                        --                      --
                                                                          ---------------         ---------------
   Net premiums earned                                                                --                      --
                                                                          ---------------         ---------------
Expenses
Loss and loss adjustment expenses
   Gross loss and loss adjustment expenses                                            --                      --
   Less: ceded loss and loss adjustment expenses                                      --                      --
                                                                          ---------------         ---------------
   Net loss and loss adjustment expenses                                              --                      --
                                                                          ---------------         ---------------
Underwriting expenses
   Ceding commission expense                                                          --                      --
   Other underwriting expenses                                                         2                      --
                                                                          ---------------         ---------------
Total underwriting expenses                                                            2                      --
                                                                          ---------------         ---------------
Underwriting Loss                                                         $           (2)         $           --
                                                                          ===============         ===============
Loss Ratios
Gross                                                                                n/a                     n/a
Net                                                                                  n/a                     n/a
Accident Year Loss Ratios
Gross                                                                                n/a                     n/a
Net                                                                                  n/a                     n/a
Underwriting Expense Ratios
Gross                                                                                n/a                     n/a
Net                                                                                  n/a                     n/a
Combined Ratios
Gross                                                                                n/a                     n/a
Net                                                                                  n/a                     n/a
</TABLE>

                                       19
<PAGE>

Insurance Segment Results of Operations for the Three Months Ended March 31,
2007 and 2006

         The insurance segment did not conduct any business and did not have any
premium income, obligations relating to insurance policies, employees and
operations for the three months ended March 31, 2007.

Reinsurance Segment Results of Operations
<TABLE>
<CAPTION>
<S>                                                                          <C>                    <C>
                                                                                    Three Months Ended March 31,
                                                                             -------------------------------------------
                                                                                     2007                   2006
                                                                             ---------------------  --------------------
                                                                                          ($ in thousands)
Revenues
Premiums earned
   Gross premiums earned                                                     $             46,596   $                --
   Less: ceded premiums earned                                                                 --                    --
                                                                             ---------------------  --------------------
   Net premiums earned                                                                     46,596                    --
                                                                             ---------------------  --------------------
Expenses
Loss and loss adjustment expenses
   Gross loss and loss adjustment expenses                                                 25,326                    --
   Less: ceded loss and loss adjustment expenses                                               --                    --
                                                                             ---------------------  --------------------
   Net loss and loss adjustment expenses                                                   25,326                    --
                                                                             ---------------------  --------------------
Underwriting expenses
   Ceding commission expense                                                               15,357
   Other underwriting expenses                                                                650                   104
                                                                             ---------------------  --------------------
Total underwriting expenses                                                                16,007                   104
                                                                             ---------------------  --------------------
Underwriting Profit (Loss)                                                   $              5,263   $              (104)
                                                                             =====================  ====================
Loss Ratios
Gross                                                                                        54.3%                  n/a
Net                                                                                          54.3%                  n/a
Accident Year Loss Ratios
Gross                                                                                        53.2%                  n/a
Net                                                                                          53.2%                  n/a
Underwriting Expense Ratios
Gross                                                                                        34.4%                  n/a
Net                                                                                          34.4%                  n/a
Combined Ratios
Gross                                                                                        88.7%                  n/a
Net                                                                                          88.7%                  n/a
</TABLE>

Reinsurance Segment Results of Operations for the Three Months Ended March 31,
2007 and 2006

         Gross premiums and net premiums. Gross and net written premiums were
$71.9 million for the three months ended March 31, 2007. The total amount of net
written premiums originated by and assumed from Tower by CastlePoint Re for the
three months ended March 31, 2007 was $51.6 million. During the same period, net
written premiums from clients other than Tower represented 28% of our net
written premiums, increased from 6% of net premiums written for the full year
2006.

         Loss and loss adjustment expenses and loss ratio. Loss and loss
adjustment expenses were $25.3 million, which produced a 54.3% loss ratio for
the three months ended March 31, 2007. Tower's brokerage business quota share
loss ratio was 52.5% during the same in 2007. We experienced $0.5 million
unfavorable case development on accident year 2006 primarily as a result of one
large loss incurred in a specialty program.

         Underwriting expenses and underwriting expense ratio. Underwriting
expenses for the reinsurance segment are comprised of ceding commission paid to
insurance companies, which cede business to CastlePoint Re, and other
underwriting expenses. Ceding commission expense was $15.4 million and other
underwriting expenses were $0.7 million for the three months ended March 31,
2007. Both the gross underwriting expense ratio and the net underwriting expense
ratio were 34.4% for the three months ended March 31, 2007, since we did not
have any ceded reinsurance during that period.

                                       20
<PAGE>

         Underwriting profit and combined ratio. The underwriting profit and
combined ratio from the reinsurance segment was $5.3 million and 88.7%,
respectively, for the three months ended March 31, 2007.

Insurance Services Segment Results of Operations
<TABLE>
<CAPTION>
<S>                                                     <C>               <C>

                                                            Three Months Ended March 31,
                                                        ------------------------------------
                                                              2007               2006
                                                        ----------------- ------------------
                                                                  ($ in thousands)
Revenues
Direct commission revenue from programs                 $          1,561  $              --
                                                        ----------------- ------------------
Total Revenues                                                     1,561                 --
                                                        ----------------- ------------------
Expenses
Direct commissions expense from programs                           1,216                ---
Other insurance services expenses                                  1,344                 18
                                                        ----------------- ------------------
Total Expenses                                                     2,560                 18
                                                        ----------------- ------------------
Insurance Services Loss                                 $           (999) $             (18)
                                                        ================= ==================
</TABLE>

Insurance Services Segment Results of Operations for the Three Months Ended
March 31, 2007

         Direct commission revenue. Direct commission revenue is dependent upon
the premiums written during the year with respect to the program business
managed by CastlePoint Management. CastlePoint Management receives a 30%
commission from Tower's insurance companies for program business placed by
CastlePoint Management with these companies less boards, bureaus and premium
taxes (which we refer to as "BB&T") and less direct commission expenses that are
incurred by these companies. Commission income was $1.5 million for the three
months ended March 31, 2007. These commission revenues were received for the
specialty programs and traditional programs. We also bound an additional program
that we expect to begin producing revenues in the third quarter of 2007.

         Direct commission expense from programs. Direct commission expense was
$1.2 million for the three months ended March 31, 2007, which consisted of the
commission fees paid by us to producing agents for services rendered on behalf
of the program business.

         Other insurance services expenses. Other insurance services expenses
were $1.3 million for the three months ended March 31, 2007. This amount
includes $0.2 million of costs incurred and charged by Tower's insurance
companies for services provided to us.

         Insurance services loss. Insurance services loss was $1.0 million for
the three months ended March 31, 2007. CastlePoint Management is currently
incurring costs at a higher rate than revenues are being generated by the
insurance services business because of the lag of written premiums and therefore
commission revenue expected to be generated in future periods from existing
programs. In addition, there is a lag time to launch new programs that requires
rates and forms to be filed and approved, as well as systems to be implemented.

Liquidity and Capital Resources

         CastlePoint Holdings is organized as a Bermuda holding company, and as
such, has no direct operations of its own. We expect substantially all of our
operations to be conducted by our insurance, reinsurance, and management company
subsidiaries. Accordingly, we expect to have continuing cash needs for
administrative expenses and the payment of principal and interest on any future
borrowings and taxes. Funds to meet these obligations will come primarily from
dividend payments from our operating subsidiaries. There are restrictions on the
payment of dividends by our insurance subsidiaries. These restrictions, as well
as our liquidity, principal capital requirements and related matters are
described in more detail in the section entitled "Management's Discussion and
Analysis of Financial Condition and Results of Operations" included in the
Registration Statement.

                                       21
<PAGE>

         Our ongoing principal consolidated cash requirements are expected to be
the capitalization of our existing operating subsidiaries, which includes
operating expenses, our acquisition of at least one additional U.S. licensed
insurance company in connection with our insurance risk-sharing and program
business within the next three to nine months, subject to receipt of regulatory
approvals, net cash settlements under the pooling and reinsurance agreements,
payment of losses and loss adjustment expenses, commissions paid to program
underwriting agents, ceding commissions to insurance companies including Tower,
excise taxes, operating expenses and payments under our service and expense
sharing agreements with Tower and certain of its subsidiaries. In addition, we
will need cash to enable us to make strategic investments in some of our clients
and potential clients, including Tower, as well as to pay dividends to our
shareholders and to service the debt on the subordinated debentures of $103.1
million issued by CastlePoint Management in December 2006. Further, while
insurance regulations differ by location, insurers and reinsurers are generally
required to maintain certain minimum levels of capital and/or risk-based
capital, the calculation of which typically includes numerous factors specified
by the respective insurance regulatory authorities and the related insurance
regulations.

         On March 28, 2007 we completed the sale of 8,697,148 common shares at
$14.50 in a firm commitment underwritten initial public offering. In addition,
119,500 shares were sold in that offering by selling shareholders who previously
purchased such shares in the private offering of our common shares we completed
in April 2006. Included in the 8,697,148 shares sold by us were 1,134,410 shares
purchased by the underwriters to cover over-allotments. The net proceeds to the
Company of the initial public offering were approximately $114 million after the
deduction of underwriting discounts and other estimated offering expenses. We
intend to use these net proceeds to further capitalize CastlePoint Re and for
general corporate purposes.

         Sources of Cash

         We expect to receive cash, from direct and assumed premiums collected,
net cash settlements under our pooling and reinsurance agreements, fee income
for services provided, investment income and proceeds from sales and redemptions
of investments. We also expect that we will raise additional funds in the future
through additional equity and/or additional debt financings.

         We or one of our subsidiaries may also enter into an unsecured
revolving credit facility and a term loan facility with one or more syndicates
of lenders, and we expect to use any such facilities for general corporate
purposes, working capital requirements and issuances of letters of credit. We
believe that any debt financing or credit facility will require compliance with
financial covenants, such as a leverage ratio, a consolidated tangible net worth
ratio and maintenance of ratings. Any debt financing or credit facility will
likely contain additional covenants that restrict the activities of our
operating subsidiaries, such as the incurrence of additional indebtedness and
liens and the payment of dividends and other payments. In addition, the terms of
any debt financings may require guarantees by CastlePoint Holdings or any of our
subsidiaries. We currently have no commitment from any lender with respect to a
credit facility. We cannot assure you that we will be able to obtain a credit
facility on terms acceptable to us.

         Cash Flows

         For the period ended March 31, 2007, net cash provided by operating
activities was approximately $34.0 million and net cash flows used in investing
activities was approximately $24.6 million. The primary sources of cash of our
operating subsidiaries are net premiums received, commission income and
investment income. Cash is used by our operating subsidiaries to pay
commissions, claims and operating expenses, as well as to purchase investments
and fixed assets, subject to regulatory, contractual, rating agencies and other
constraints applicable to us. The net cash flows provided by financing
activities for the period ended March 31, 2007 were approximately $114.2
million, which primarily consisted of approximately $114.9 million in net
proceeds after all estimated offering expenses, less dividends paid to
shareholders of $0.7 million.

                                       22
<PAGE>

Trust Agreements

         Under the terms of the quota share reinsurance agreements between
CastlePoint Re and Tower's insurance companies, CastlePoint Re is required to
provide security to Tower's insurance companies to support reinsurance
recoverables owed to these reinsureds in a form acceptable to the insurance
commissioners of the State of New York and Commonwealth of Massachusetts, the
domiciliary states of Tower's insurance companies. This trust arrangement
permits Tower's insurance companies to take credit on their statutory financial
statements for the reinsurance ceded to CastlePoint Re, either as an additional
asset or as a reduction in liability. CastlePoint Re is also required by its
reinsurance agreements with its other cedents to collateralize amounts through a
letter of credit, cash advance, funds held or a trust account meeting the
requirements of the applicable state insurance regulations.

         As of March 31, 2007, CastlePoint Re had trust accounts for the benefit
of its reinsureds totaling approximately $133.3 million, an increase of
approximately $28.9 million since December 31, 2006. CastlePoint Re earns and
collects the interest on the trust funds.

Investments

         The aggregate fair market value of our available-for-sale investments
as of March 31, 2007 was $412.5 million, excluding our investment in common
trust securities of the two statutory business trusts described below under
"--Off-Balance Sheet Transactions." Our fixed maturity securities as of this
date had a fair market value of $410.7 million and an amortized cost of $408.4
million. Short term investments were carried at fair value of $1.8 million as of
March 31, 2007.

Off-Balance Sheet Transactions

         We recently formed two Delaware statutory business trusts of which
CastlePoint Management owns all of the common trust securities, to facilitate
the trust preferred financing we completed in December 2006.

Ratings

         During the first quarter of 2007, CastlePoint Insurance has received a
Financial Strength rating of "A-" (Excellent) from A.M. Best Company, Inc.,
which is the fourth highest of fifteen rating levels and indicates A.M. Best's
opinion of our financial strength and ability to meet ongoing obligations to our
future policyholders. A.M. Best also confirmed the "A-" (Excellent) rating it
previously assigned to CastlePoint Re. The maintenance of the assigned ratings
depends upon CastlePoint Re and CastlePoint Insurance operating in a manner
consistent with the business plan presented to A.M. Best. A.M. Best formally
evaluates its Financial Strength ratings of insurance companies at least once
every twelve months and monitors the performance of rated companies throughout
the year.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

         Market risk relates to changes in the value of financial instruments
that arise from adverse movements in factors such as interest rates and equity
prices. We are exposed mainly to changes in interest rates that affect the fair
value of our investments in securities.

Sensitivity Analysis

         Sensitivity analysis is a measurement of potential loss in future
earnings, fair values or cash flows of market sensitive instruments resulting
from one or more selected hypothetical changes in interest rates and other
market rates or prices over a selected time. In our sensitivity analysis model,
we select a hypothetical change in market rates that reflects what we believe
are reasonably possible near-term changes in those rates. The term "near-term"
means a period of time going forward up to one year from the date of the
consolidated financial statements. Actual results may differ from the
hypothetical change in market rates assumed in this disclosure, especially since
this sensitivity analysis does not reflect the results of any action that we may
take to mitigate such hypothetical losses in fair value.

                                       23
<PAGE>

         In this sensitivity analysis model, we use fair values to measure our
potential loss. The sensitivity analysis model includes fixed maturities and
short-term investments.

         For invested assets, we use modified duration modeling to calculate
changes in fair values. Durations on invested assets are adjusted for call, put
and interest rate reset features. Durations on tax-exempt securities are
adjusted for the fact that the yield on such securities is less sensitive to
changes in interest rates compared to Treasury securities. Invested asset
portfolio durations are calculated on a market value weighted basis, including
accrued investment income, using holdings as of March 31, 2007.

         The following table summarizes the estimated change in fair value on
our fixed maturity portfolio including short-term investments based on specific
changes in interest rates as of March 31, 2007:
<TABLE>
<CAPTION>
<C>                                                                                   <C>                         <C>
                                                                      Estimated Increase         Estimated Percentage
                                                                    (Decrease) in Fair Value      Increase (Decrease)
Change in Interest Rate                                                 ($ in thousands)             in Fair Value
----------------------------------------------------------------  ---------------------------- -------------------------
300 basis point rise                                                                  (35,355)                    (8.5)%
200 basis point rise                                                                  (23,175)                    (5.6)%
100 basis point rise                                                                  (11,052)                    (2.7)%
100 basis point decline                                                                 8,892                       2.1%
200 basis point decline                                                                15,744                       3.8%
300 basis point decline                                                                22,770                       5.5%
</TABLE>

         The sensitivity analysis model used by us produces a predicted pre-tax
loss in fair value of market-sensitive instruments of $11.1 million or 2.7%
based on a 100 basis point increase in interest rates as of March 31, 2007. This
loss amount only reflects the impact of an interest rate increase on the fair
value of our fixed maturities, which constituted approximately 98.8% of our
total invested assets as of March 31, 2007.

         As of March 31, 2007, we had a total of $103.1 million of outstanding
debt, all of which are outstanding junior subordinated debentures underlying our
trust securities issued by our wholly owned statutory business trusts carrying a
fixed interest rate during the first five years, after which the interest rate
will become floating and equal to the three month LIBOR rate plus 3.5% per annum
(calculated quarterly). If LIBOR rates increase, the amount of interest payable
by us would also increase.

Item 4.  Controls and Procedures

         Our management, with the participation of the Chief Executive Officer
and Chief Financial Officer, has evaluated the effectiveness of the design and
operation of our disclosure controls and procedures (as defined in Rule
13a-15(e) of the Securities Exchange Act of 1934, as amended) as of the end of
the period covered by this quarterly report. Based on that evaluation, the Chief
Executive Officer and Chief Financial Officer have concluded that our disclosure
controls and procedures are effective to provide reasonable assurance that
material information relating to us and our consolidated subsidiaries required
to be disclosed in our reports filed with or submitted to the SEC under the
Securities Exchange Act of 1934, as amended, is made known to such officers by
others within these entities, particularly during the period this quarterly
report was prepared, in order to allow timely decisions regarding required
disclosure.

         There have not been any changes in our internal control over financial
reporting during the three months ended March 31, 2007 that have materially
affected, or are reasonably likely to materially affect, our internal control
over financial reporting.

         Under the rules of the SEC as currently in effect, compliance with the
internal control reporting requirements mandated by Section 404 of the
Sarbanes-Oxley Act of 2002 is delayed for newly public companies, such as
CastlePoint Holdings. We plan to be in full compliance with these internal
control reporting requirements by the required compliance dates.

                                       24
<PAGE>

                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

         We are not a party to any pending or threatened material litigation and
are not currently aware of any pending or threatened material litigation, other
than in the normal course of business as a reinsurer. We may become involved in
various claims and legal proceedings in the normal course of business, as a
reinsurer or insurer.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

         (a)      Not applicable.

         (b)      On March 22, 2007, the SEC declared effective the Company's
Registration Statement on Form S-1, as amended (Registration No. 333-139939),
filed in connection with the initial public offering of its common shares, par
value $0.01 per share. Under this Registration Statement and a related
registration statement the Company filed on Form S-1 pursuant to Rule 462(b)
(Registration No. 333-141530), the Company registered 8,816,648 common shares,
including 1,134,410 shares subject to the over-allotment option we granted to
the underwriters. The Company registered 8,697,148 of these shares on its own
behalf and 119,500 of these shares on behalf of the selling shareholders, for an
aggregate public offering price of approximately $127.8 million. On March 28,
2007, the Company completed the offering at an initial offering price per share
of $14.50, in which (i) the Company sold 8,697,148 shares it registered on its
own behalf, and (ii) selling shareholders sold 119,500 shares the Company
registered on their behalf. The managing underwriters for the initial public
offering were Friedman, Billings, Ramsey & Co., Inc., Keefe, Bruyette & Woods,
Inc., Cochran Caronia Waller Securities LLC and Piper Jaffray & Co.

         The aggregate proceeds of the offering (including sale of the 1,134,410
shares sold pursuant to the underwriters' over-allotment option) were
approximately $127.8 million, of which the gross proceeds to the Company were
approximately $126.1 million. Net proceeds to the Company, after deducting
underwriting discounts of approximately $8.5 million and other estimated
offering expenses of approximately $3.6 million, were approximately $114
million. The gross proceeds to the selling shareholders were approximately $1.7
million in the aggregate, and net proceeds to the selling shareholders were
approximately $1.6 million in the aggregate. The Company did not receive any of
the proceeds of the sale by the selling shareholders. We intend to use our net
proceeds from the initial public offering to further capitalize CastlePoint Re
and for general corporate purposes.

         (c)      Not applicable.

Item 6.  Exhibits

31.1         Chief Executive Officer - Certification pursuant to Sarbanes-Oxley
             Act of 2002 Section 302

31.2         Chief Financial Officer - Certification pursuant to Sarbanes-Oxley
             Act of 2002 Section 302

32           Chief Executive Officer and Chief Financial Officer - Certification
             pursuant to Sarbanes-Oxley Act of 2002 Section 906

                                       25
<PAGE>

                                   SIGNATURES

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

                                        CASTLEPOINT HOLDINGS, LTD.
                                                        (Registrant)





     Date: May 14, 2007                            /s/ Michael H. Lee
                                                   ------------------
                                                   Michael H. Lee
                                                   Chairman of the Board and
                                                   Chief Executive Officer



     Date: May 14, 2007                            /s/ Joel S. Weiner
                                                   ------------------
                                                   Joel S. Weiner
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                       26
<PAGE>

                                  EXHIBIT INDEX



Exhibit Number                               Description

31.1                Chief Executive Officer - Certification pursuant to
                    Sarbanes-Oxley Act of 2002 Section 302
31.2                Chief Financial Officer - Certification pursuant to
                    Sarbanes-Oxley Act of 2002 Section 302
32                  Chief Executive Officer and Chief Financial Officer -
                    Certification pursuant to Sarbanes-Oxley Act of 2002 Section
                    906

                                       27