Montpelier Re Reports Net Income of $109.0 Million for the First Quarter of 2004

Book value per share at March 31, 2004, on a fully converted basis (1), was $26.44, which includes the accrual of a $0.34 dividend per share for the quarter. Total return to shareholders (2), incorporating both the increase in fully converted book value per share and dividends accrued, was 30.3% for the 12 months ended March 31st 2004 and 7.5% for the first quarter of 2004.

Anthony Taylor, Chairman, President and CEO, commented: 'Montpelier had a successful January renewal season. The range and quality of business we have seen continues to improve as the reputation of our underwriting and risk management skills develops, leading to further growth in our core lines of business. Offset against these improvements is a small overall decline in rates on renewed business, and our disciplined approach to program selection has resulted in a rise in the number of risks we have declined. We will continue to put underwriting discipline first and foremost, as we believe it is the most important element in producing superior long-term results for owners.'

Anthony Taylor continued: 'Our April renewal season saw a continued healthy showing of business. Overall in the lines of business we write, at the layers we tend to participate in, rates remain favorable. Notwithstanding modest reductions in certain classes, based on our current expectations on prices and terms, we remain confident that we will experience an increase in gross written premium in 2004 over 2003 despite the planned non-renewal of the Lloyd's QQS business.'

Tom Kemp, Chief Financial Officer, stated: 'Our results in the first quarter of 2004 continue the pattern of outstanding returns in 2002 and 2003. Our combined ratio was 50.1% in the quarter, compared to 52.8% in the first quarter in 2003. Continuing lines of business experienced premium growth of 14.4% and our net earned premium was $190.8 million in the first quarter of 2004, compared to $184.7 million for the same period in 2003. Gross written premium was $333.2 million in the quarter, down from $366.6 million in the first quarter of 2003 which largely reflects the non-renewal of the Lloyd's QQS programs in 2004. Should results continue to be strong, we will manage our capital with a view to meeting our target rate of return to shareholders over the cycle.'

Please refer to the Montpelier Re Financial Supplement, which is posted on the Financial Reports page in the Company's investor information section of its website at www.montpelierre.bm, for more detailed information on performance by category of business, together with additional disclosure on total return, loss reserves, investment portfolio and capital structure.

(1) Fully converted book value per share is a non-GAAP measure based on total shareholders' equity plus the assumed proceeds from the exercise of outstanding options and warrants of $167.3 million and $168.1 million at March 31st 2004 and 2003, respectively,divided by the sum of shares, options and warrants outstanding (assuming their exercise) of 73,261,757 shares at March 31, 2004 and 2003. The Company believes that fully converted book value per share more accurately reflects the value attributable to a common share.

(2) Total return to shareholders is a non-GAAP measure. It is the percentage increase in fully converted book value per share plus dividends accrued. It is calculated as the March 31, 2004 fully converted book value per share of $26.44 plus the accrued dividend of $0.34, less the fully converted book value per share at December 31, 2003 of $24.92, with the result then being divided by $24.92. The Company believes that this measure most accurately reflects the return made by its shareholders as it takes into account the effect of all dilutive securities and the effect of dividends.

Earnings Conference Call:

Montpelier Re executives will conduct a conference call, including a question and answer period, on Wednesday, April 28th at 10:00 a.m. Eastern Time.

The presentation will be available via a live audio webcast accessible through the Company's investor information section of its website at www.montpelierre.bm. A telephone replay of the conference call will be available through May 7th, 2004 by dialing 888-286-8010 (toll-free) or 617-801-6888 (international) and entering the pass code: 56182101.

Montpelier Re Holdings Ltd., through its operating subsidiary, Montpelier Reinsurance Ltd., is a premier provider of global property and casualty reinsurance and insurance products. Montpelier Reinsurance Ltd. is rated "A" (Excellent) by A.M. Best Company, "A-" (Strong) by Standard & Poor's and "A3" (Good) by Moody's Investors Service.

Application of the Safe Harbor of the Private Securities Litigation Reform Act of 1995:

This press release contains, and Montpelier may from time to time make, written or oral "forward-looking statements" within the meaning of the U.S. federal securities laws, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties and other factors, many of which are outside the Company's control that could cause actual results to differ materially from such statements. In particular, statements using words such as "may", "should", "estimate", "expect", "anticipate", "intend", "believe", "predict", "potential", or words of similar import generally involve forward-looking statements.

Important events and uncertainties that could cause the actual results, future dividends or future repurchases to differ include, but are not necessarily limited to: market conditions affecting Montpelier's common share price; our short operating and trading history; our dependence on principal employees; the cyclical nature of the reinsurance business; the levels of new and renewal business achieved; opportunities to increase writings in our core property and specialty reinsurance and insurance lines of business and in specific areas of the casualty reinsurance market; the estimates reported by syndicates under existing QQS contracts; the inherent uncertainties of establishing reserves for loss and loss adjustment expenses, particularly on longer-tail classes of business such as casualty; the possibility of severe or unanticipated losses from natural or man-made catastrophes; the impact of terrorist activities on the economy; competition in the reinsurance industry and rating agency policies and practices. The Company's forward-looking statements concerning market fundamentals could be affected by changes in demand, pricing and policy term trends and competition. These and other events that could cause actual results to differ are discussed in detail in "Risk Factors" contained in Item 1 of the Company's Annual Report on Form 10-K for the year ended December 31, 2003 filed with the Securities and Exchange Commission.

Montpelier undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made.