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WHITE MOUNTAINS REPORTS THIRD QUARTER RESULTS

06 November 2019

HAMILTON, Bermuda 06 November 2019 - In a filing with the Bermuda Stock Exchange, White Mountains Insurance Group, Ltd., (the “Company “; Tickers: NYSE: WTM; BSX: WTM.BH) announced third quarter results. The filing stated:

WHITE MOUNTAINS REPORTS THIRD QUARTER RESULTS

HAMILTON, Bermuda (November 6, 2019) - White Mountains Insurance Group, Ltd. (NYSE: WTM) reportedbook value per share of $1,003 and adjusted book value per share of $1,005 as of September 30, 2019. Book value per share and adjusted book value per share both increased 2% in the third quarter of 2019. Book value per share and adjusted book value per share increased 12% and 13% in the first nine months of 2019, including dividends. The results for the first nine months of 2019 include the impact of the MediaAlpha transaction. Excluding the gain on the MediaAlpha transaction, book value per share and adjusted book value per share would have increased 6% and 7% in the first nine months of 2019, including dividends.⁽¹⁾

Manning Rountree, CEO, commented, “We had a good quarter on all fronts. Despite challenging primary market conditions, BAM produced strong premium volume, including a significant assumed reinsurance transaction. NSM again produced solid growth on both the top and bottom line. Kudu added three new investments in the quarter and has nearly deployed all of our initial $250 million commitment. Our investment portfolio was up

3.1%, a strong result that includes an increase in the fair value of our investment in MediaAlpha, which produced another quarter of record results. We ended the quarter with $1.1 billion of undeployed capital.”

Comprehensive income attributable to common shareholders was $46 million and $348 million in the third quarter and first nine months of 2019, compared to comprehensive income (loss) attributable to common shareholders of $40 million and $(5) million in the third quarter and first nine months of 2018.

HG Global/BAM

BAM’s gross written premiums and member surplus contributions (MSC) collected were $44 million and $84 million in the third quarter and first nine months of 2019, compared to $16 million and $56 million in the third quarter and first nine months of 2018. BAM insured municipal bonds with par value of $4.1 billion and $8.9 billion in the third quarter and first nine months of 2019, compared to $2.2 billion and $6.6 billion in the third quarter and first nine months of 2018. In the third quarter of 2019, BAM completed an assumed reinsurance transaction to insure municipal bonds with a par value of $1.1 billion. Total pricing was 107 and 94 basis points in the third quarter and first nine months of 2019, compared to 75 and 91 basis points in the third quarter and first nine months of 2018. BAM’s total claims paying resources were $930 million at September 30, 2019, compared to $871 million at December 31, 2018 and $835 million at September 30, 2018.

Seán McCarthy, CEO of BAM, said, “BAM had a strong quarter. Overall new issue volume rose as issuers took advantage of lower interest rates to refinance outstanding bonds, and investor demand for insurance increased. However, lower interest rates and tighter credit spreads continued to impact pricing in the primary market. In the quarter, BAM insured $2.7 billion of municipal bonds in the primary market, up 31% year over year, and an additional $289 million in the secondary market, up almost 100% year over year. We also completed our second assumed reinsurance transaction, helping to bring total par in force to a new high of $59 billion.”.

HG Global reported pre-tax income of $14 million and $44 million in the third quarter and first nine months of 2019, compared to pre-tax income of $8 million and $21 million in the third quarter and first nine months of 2018. White Mountains reported pre-tax loss related to BAM of $10 million and $26 million in the third quarter and first nine months of 2019, compared to pre-tax loss of $17 million and $53 million in the third quarter and first nine months of 2018. The period over period changes were driven primarily by higher investment returns in the HG Global and BAM investment portfolios.

BAM is a mutual insurance company that is owned by its members. BAM’s results are consolidated into White Mountains’s GAAP financial statements and attributed to non-controlling interests.

NSM

In the third quarter of 2019, NSM reported pre-tax income of $5 million, adjusted EBITDA of $13 million, and commission and other revenues of $60 million. In the first nine months of 2019, NSM reported pre-tax income of $4 million, adjusted EBITDA of $39 million, and commission and other revenues of $175 million. Results for the third quarter and first nine months of 2019 include Embrace Pet Insurance, a nationwide provider of pet health insurance for dogs and cats, which NSM acquired on April 1, 2019, and KBK Insurance Group, a specialized MGU focused on the towing and transportation space, which NSM acquired on December 3, 2018.

Geof McKernan, CEO of NSM, said, “NSM had another solid quarter. Trailing 12 months pro forma controlled premiums grew to $883 million, and pro forma adjusted EBITDA reached $50 million for the first time ever. These results reflect strong growth in the specialty transportation and pet verticals. We continue to invest in technology and talent to drive organic growth while also pursuing attractive acquisition opportunities.”

Kudu

In the third quarter of 2019, Kudu deployed $77 million in three investment management firms. Kudu has now deployed a total of $222 million in eight investment management firms with combined assets under management of over $30 billion, spanning a range of asset classes, including real estate, real assets, wealth management, hedge funds and alternative credit strategies.

In the third quarter of 2019, Kudu reported total revenues of $8 million and pre-tax income of $3 million. For the period from April 4, 2019 through September 30, 2019, Kudu reported total revenues of $12 million and pre-tax income of $5 million.

Rob Jakacki, CEO of Kudu, said, “Kudu remained active during the third quarter, adding three new investments to our portfolio. We have now deployed $222 million of capital into eight transactions with an average cash yield at inception of 10.2%. The Kudu business as a whole was profitable for the second consecutive quarter with higher revenues driven by both the steady growth in assets under management from the existing portfolio and the impact of the new transactions in the third quarter. We continue to see strong opportunities in the private capital and wealth management segments.”

Other Operations

White Mountains’s Other Operations segment reported pre-tax income of $40 million and $328 million in the third quarter and first nine months of 2019, compared to pre-tax income (loss) of $53 million and $(9) million in the third quarter and first nine months of 2018. Pre-tax income in the first nine months of 2019 included $182 million of realized and unrealized gains from the MediaAlpha transaction. Excluding the MediaAlpha transaction, net realized and unrealized investment gains were $57 million and $200 million in the third quarter and first nine months of 2019, compared to net realized and unrealized investment gains of $70 million and $37 million in the third quarter and first nine months of 2018.

Investments

The total return on invested assets was 3.1% in both the third quarter of 2019 and 2018. The total return on invested assets was 15.9% in the first nine months of 2019, which included $115 million of unrealized investment gains from the MediaAlpha transaction. Excluding the MediaAlpha transaction, the total return on invested assets was 11.3% in the first nine months of 2019 compared to 2.8% in the first nine months of 2018.

Mark Plourde, Managing Director of White Mountains Advisors, said, “The total portfolio was up 3.1% in the third quarter. This result includes the impact of a $35 million increase in the fair value of our investment in MediaAlpha, driven by continued topline and bottom line growth since the MediaAlpha transaction in February. Common stocks returned 1.0%, behind the S&P 500 return of 1.7% due to relative underperformance in our international positions. Fixed income returned 1.3%, essentially in-line with the BBIA Index return of 1.4%.”

Additional Information

White Mountains is a Bermuda-domiciled financial services holding company traded on the New York Stock Exchange and the Bermuda Stock Exchange under the symbol WTM. Additional financial information and other items of interest are available at the company’s website located at www.whitemountains.com. White Mountains expects to file its Form 10-Q today with the Securities and Exchange Commission and urges shareholders to refer to that document for more complete information concerning its financial results.

Consequently, all of the forward-looking statements made in this earnings release are qualified by these cautionary statements, and there can be no assurance that the actual results or developments anticipated by White Mountains will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, White Mountains or its business or operations. White Mountains assumes no obligation to publicly update any such forward-looking statements, whether as a result of new information, future events or otherwise.

The complete press release can be found by using the following link:

http://investor.whitemountains.com/static-files/b4decfb1-e0a2-4ece-813f-bb5f7571afa6

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

This earnings release may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included or referenced in this release which address activities, events or developments which White Mountains expects or anticipates will or may occur in the future are forward-looking statements. The words “will”, “believe”, “intend”, “expect”, “anticipate”, “project”, “estimate”, “predict” and similar expressions are also intended to identify forward-looking statements. These forward-looking statements include, among others, statements with respect to White Mountains’s:

• change in adjusted book value per share or return on equity;

• business strategy;

• financial and operating targets or plans;

• incurred loss and loss adjustment expenses and the adequacy of its loss and loss adjustment expense reserves;

• projections of revenues, income (or loss), earnings (or loss) per share, dividends, market share or other financial forecasts;

• expansion and growth of its business and operations; and

• future capital expenditures.

These statements are based on certain assumptions and analyses made by White Mountains in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors believed to be appropriate in the circumstances. However, whether actual results and developments will conform to its expectations and predictions is subject to risks and uncertainties that could cause actual results to differ materially from expectations, including:

• the risks that are described from time to time in White Mountains’s filings with the Securities and Exchange Commission, including but not limited to White Mountains’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 and White Mountains’s June 30, 2019 Quarterly Report on Form 10-Q;

• business opportunities (or lack thereof) that may be presented to it and pursued;

• actions taken by ratings agencies from time to time, such as financial strength or credit ratings downgrades or placing ratings on negative watch;

• the continued availability of capital and financing;

• general economic, market or business conditions;

• competitive forces, including the conduct of other insurers;

• changes in domestic or foreign laws or regulations, or their interpretation, applicable to White Mountains, its competitors or its customers;

• an economic downturn or other economic conditions adversely affecting its financial position; and

• other factors, most of which are beyond White Mountains’s control.