Montpelier Re Reports Second Quarter Financial Results

HAMILTON Bermuda: July 27 2011 - Montpelier Re Holdings Ltd. (NYSE: MRH), (“Montpelier” or the “Company”), a leading provider of short-tail reinsurance and other specialty lines, today reported financial results for the second quarter ended June 30, 2011.

Fully converted book value per common share was $23.36, an increase of 1.6% from March 31, 2011, after taking into account common share dividends declared during the quarter.

Operating income for the quarter was $0.08 per common share ($5 million) and net income was $0.33 per common share ($21 million), each expressed after preferred share dividends. The net impact of realized and unrealized gains from investments and foreign exchange, which is included in net income, was $16 million for the quarter.

The 69% loss ratio for the second quarter includes $39 million of net catastrophe losses, resulting from tornado activity in the United States in April and May, in addition to $15 million resulting from a high incidence of non-catastrophe losses in the quarter. This was partially offset by $20 million of favorable prior year loss reserve movements. The combined ratio was 103% for the quarter.

Net investment income was $17 million for the second quarter and the total return on the investment portfolio was 1.0%.

Christopher Harris, President and Chief Executive Officer, said, “Mid-year property catastrophe renewals were encouraging with average rate increases of 8% in the U.S. and 20% in the international portfolios. For the time being, we have maintained our reduced catastrophe risk profile in light of our expectation of further price increases heading into 2012. Consequently, we believe we are well-positioned and have the capital flexibility to take advantage of a market turn.”

During the second quarter of 2011, the Company repurchased a total of 811,350 common shares for $15 million and issued $150 million of non-cumulative perpetual preferred shares. As of June 30, 2011, shareholders’ equity was $1.62 billion and total capital was $1.95 billion.

Please refer to Montpelier’s June 30, 2011 Financial Supplement for more detailed financial information, which is posted on the Company’s website at www.montpelierre.bm.

Earnings Conference Call:

The Company will conduct a conference call, including a question and answer period, on Thursday, July 28, 2011 at 8:00 a.m. Eastern Time.

The presentation will be available via a live audio webcast accessible on the Company's website at www.montpelierre.bm or by dialing 1-877-317-6789 (US toll free), 1-412-317-6789 (international) or 1-866-605-3852 (Canada toll free). A telephone replay of the conference call will be available through August 10, 2011 by dialing 1-877-344-7529 (toll-free) or 1-412-317-0088 (international) and entering the passcode 451585.

Montpelier, through its operating subsidiaries, is a premier provider of global property and casualty reinsurance and insurance products. Additional information can be found in Montpelier's public filings with the Securities and Exchange Commission.

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

For full report please see:

 http://www.snl.com/irweblinkx/file.aspx?IID=4076538&FID=11517105