Exhibit 99.1

Contact
Investor Relations
Phone: (441) 278-0988
Email: investorrelations@endurance.bm

ENDURANCE REPORTS FOURTH QUARTER NET INCOME OF $111.2 MILLION

PEMBROKE, Bermuda — February 9, 2011 — Endurance Specialty Holdings Ltd. (NYSE:ENH) today reported net income of $111.2 million and $2.09 per diluted common share for the fourth quarter of 2010 versus net income of $154.8 million and $2.56 per diluted common share for the fourth quarter of 2009.

For the year ended December 31, 2010, net income was $364.7 million and $6.38 per diluted common share versus net income of $536.1 million and $8.69 per diluted common share for the year ended December 31, 2009.

Operating highlights for the quarter ended December 31, 2010 were as follows:

	•		Net premiums written of $158.1 million, an increase of 8.0% over the same period in 2009;
	•		Combined ratio of 84.6%, which included 5.2 percentage points of favorable prior year loss reserve development;
	•		Net investment income of $56.9 million, a decrease of $2.4 million from the same period in 2009;
	•		Operating income, which excludes after-tax realized investment gains and losses and foreign exchange gains and losses, of $108.3 million and $2.04 per diluted common share;
	•		Operating return on average common equity for the quarter of 3.9%, or 15.6% on an annualized basis; and
	•		Book value of $52.74 per diluted common share, up 1.76% from September 30, 2010.

Operating highlights for the year ended December 31, 2010 were as follows:

	•		Net premiums written of $1,763.7 million, an increase of 9.8% over 2009;
	•		Combined ratio of 88.7%, which included 7.3 percentage points of favorable prior year loss reserve development;
	•		Net investment income of $200.4 million compared to $284.2 million for full year 2009;
	•		Operating income, which excludes after-tax realized investment gains and losses and foreign exchange gains and losses, of $345.5 million and $6.03 per diluted common share;
	•		Operating return on average common equity of 12.6%; and
	•		Book value of $52.74 per diluted common share, an 18.2% increase from December 31, 2009.

David Cash, Chief Executive Officer, commented, “2010 was a strong year for Endurance both financially and strategically. The Company earned a 12.6% operating return on equity despite a number of large industry catastrophe losses and historically low fixed income yields, launched several strategic initiatives that will help extend our portfolio of specialty businesses and grew book value per share significantly.”

Insurance Segment

Operating highlights for Endurance’s Insurance segment for the quarter ended December 31, 2010 were as follows:

	•		Net premiums written of $81.6 million, a decrease of 7.7% from the fourth quarter of 2009;
	•		Combined ratio of 86.7%, an improvement of 0.5 percentage points from the fourth quarter of 2009; and
	•		Favorable prior year loss reserve development of 5.6 percentage points during the current period, compared to 11.2 percentage points of favorable prior year loss reserve development in the fourth quarter of 2009.

Operating highlights for Endurance’s Insurance segment for the year ended December 31, 2010 were as follows:

	•		Net premiums written of $829.9 million, an increase of 12.1% from the prior year;
	•		Combined ratio of 90.6%, an improvement of 1.4 percentage points from 2009; and
	•		Favorable prior year loss reserve development of 5.7 percentage points during the current period, compared to 11.2 percentage points of favorable prior year loss reserve development in 2009.

The decline of $6.8 million in net premiums written in the Insurance segment in the fourth quarter of 2010 compared to the fourth quarter of 2009 was predominantly due to reduced premiums in the property and professional lines of business, as pricing pressure led to the non-renewal of business that no longer met our return objectives. Partially offsetting this reduction was modest growth in the agriculture, casualty and healthcare lines of business. For the year ended December 31, 2010, net written premiums increased $89.6 million compared to a year ago as significant growth within the agriculture and property lines resulted from retaining more business on a net basis in the current year. The Company also experienced modest growth within the casualty and healthcare liability lines of business, partially offset by a decline in the professional line of business.

The improvement in the Insurance segment combined ratio in the current year and quarter ended December 31, 2010 compared to the same periods in 2009 was driven by lower acquisition expense ratios, partially offset by higher net loss and general and administrative expense ratios. The current periods’ acquisition expense ratios improved over the prior periods largely due to agriculture net premiums written, which maintain lower acquisition expenses, constituting a greater proportion of net premiums written. The modest increases in the net loss ratios were driven by lower levels of favorable prior year loss reserve development in the current periods compared to a year ago, which was predominantly offset by improved loss experience in the current periods’ agriculture and property lines of business. The current periods’ general and administrative expense ratios increased compared to the same periods a year ago as less ceding commission was received as the Company utilized less reinsurance in the agriculture and property lines of business.

Reinsurance Segment

Operating highlights for Endurance’s Reinsurance segment for the quarter ended December 31, 2010 were as follows:

	•		Net premiums written of $76.5 million, an increase of 31.8% from the fourth quarter of 2009;
	•		Combined ratio of 82.8%, an increase of 19.7 percentage points from the fourth quarter of 2009; and
	•		Favorable prior year loss reserve development of 4.9 percentage points during the current period, compared to 9.7 percentage points of favorable prior year loss reserve development in the fourth quarter of 2009.

Operating highlights for Endurance’s Reinsurance segment for the year ended December 31, 2010 were as follows:

	•		Net premiums written of $933.9 million, an increase of 7.9% from 2009;
	•		Combined ratio of 86.9%, an increase of 11.0 percentage points from the prior year; and
	•		Favorable prior year loss reserve development of 8.7 percentage points during the current period, compared to 7.3 percentage points of favorable prior year loss reserve development in 2009.

The $18.5 million increase in net premiums written in the Reinsurance segment during the fourth quarter of 2010 over the fourth quarter of 2009 resulted primarily from growth in the casualty, catastrophe, and aerospace and marine lines of business. Partially offsetting this growth were modest declines in net premiums written within the property line of business. The largest change in the quarter was experienced in the casualty line of business from a higher level of favorable premium adjustments than a year ago and from one new non-standard auto reinsurance treaty with an existing client that incepted in the fourth quarter. For full year 2010, net premiums written increased $68.1 million compared to full year 2009 driven by growth across all lines of business. While the catastrophe, property, and aerospace and marine lines of business recorded modest growth, the casualty and surety lines of business posted more robust growth due to writing a few select new contracts during the year paired with higher favorable premium adjustments.

The combined ratios in the Reinsurance segment for the current periods increased compared to the same periods in 2009 due to higher net loss ratios, as the industry experienced a greater frequency of large loss events during 2010, including the earthquake in Chile and European Windstorm Xynthia in the first quarter and the earthquake in New Zealand in the third quarter. Partially offsetting the increase in the net loss ratio in the current year was the recognition of greater favorable prior year loss reserve development within the short and long tail lines of business compared to the same period in 2009.

The Company’s acquisition expense ratios declined in the current periods compared to the same periods in 2009 due to reduced profit and loss sensitive commissions. The general and administrative expense ratios declined in the current periods due to a higher earned premium base and lower variable incentive compensation compared to prior year periods. Lower variable compensation was driven by lower corporate profitability in the current year, which was caused by higher catastrophe losses and reduced investment yields compared to a year ago.

Investments

Endurance’s net investment income decreased 4.0% or $2.4 million for the quarter ended December 31, 2010 and 29.5% or $83.8 million for the year ended December 31, 2010 compared to the same periods in 2009. During the fourth quarter and year ended December 31, 2010, Endurance’s net investment income included gains of $16.4 million and $40.3 million on its alternative investment funds and high yield loan funds which are included in other investments, as compared to gains of $16.8 million and $98.1 million in the fourth quarter and year ended December 31, 2009. Investment income generated from Endurance’s fixed maturity investments declined by $1.4 million and $20.8 million for the three months and year ended December 31, 2010 compared to the same periods in 2009. This decrease resulted from lower reinvestment rates during 2010, driven by lower market yields, partially offset by higher average investment portfolio balances. For the same reasons, the ending book yield on Endurance’s fixed maturity investments at December 31, 2010 was 3.13%, down from 3.29% at December 31, 2009.

At December 31, 2010, Endurance’s fixed maturity portfolio, which comprises 93.2% of Endurance’s investments, had an average credit quality of AA and a duration of 2.39 years. Endurance’s fixed maturity portfolio was in an unrealized gain position of $129.8 million at December 31, 2010, an improvement of $91.6 million from December 31, 2009. Endurance recorded net realized gains on investment sales, including impairment losses recognized in earnings, of $6.6 million and $18.5 million during the fourth quarter and full year of 2010 compared to net realized investment gains of $2.2 million and losses of $13.9 million during the same periods in 2009.

Endurance ended the fourth quarter of 2010 with cash and invested assets of $6.2 billion, which represents a 3.6% increase from December 31, 2009. Net operating cash flow was $407.2 million for the year ended December 31, 2010 versus $471.9 million for the year ended December 31, 2009.

Capitalization and Shareholders’ Equity

At December 31, 2010, Endurance’s shareholders’ equity was $2.85 billion or $52.74 per diluted common share versus $2.79 billion or $44.61 per diluted common share at December 31, 2009. During the three months ended December 31, 2010, Endurance repurchased 2.5 million of its common shares and share equivalents for an aggregate repurchase price of $107.5 million. For the full year of 2010, Endurance repurchased 8.7 million common shares and share equivalents for an aggregate repurchase price of $338.1 million and an average price of $38.96.

Subsequent Event

On January 24, 2011, Endurance announced that it had entered into an agreement to repurchase the ordinary shares and options held by two affiliated funds of Perry Corp., which was a founding shareholder of Endurance, for $44.99 per ordinary share. Endurance repurchased 7,143,056 ordinary shares and options to purchase an additional 10,000 ordinary shares which represented approximately 15% of the Company’s ordinary shares outstanding as of December 31, 2010. The aggregate repurchase price for the shares and the options was $321.5 million and the transaction was completed on January 28, 2011.

Earnings Call

Endurance will host a conference call on February 10, 2011 at 8:30 a.m. Eastern time to discuss its financial results. The conference call can be accessed via telephone by dialing (877) 440-5788 or (719) 325-4937 (international) and entering pass code: 4905037. Those who intend to participate in the conference call should register at least ten minutes in advance to ensure access to the call. A telephone replay of the conference call will be available through February 24, 2011 by dialing (888) 203-1112 or (719) 457-0820 (international) and entering the pass code: 4905037.

The public may access a live broadcast of the conference call at the “Investors” section of Endurance’s website, www.endurance.bm. Following the live broadcast, an archived version will continue to be available on Endurance’s website.

A copy of Endurance’s financial supplement for the fourth quarter of 2010 will be available on Endurance’s website at www.endurance.bm shortly after the release of earnings.

Operating income, operating return on average common equity, operating income per diluted common share, operating income allocated to common shareholders and the combined ratio excluding prior year net loss reserve development are non-GAAP measures. Reconciliations of these measures to the appropriate GAAP measures are included in the attached tables.

About Endurance Specialty Holdings

Endurance Specialty Holdings Ltd. is a global specialty provider of property and casualty insurance and reinsurance. Through its operating subsidiaries, Endurance writes property, casualty, healthcare liability, agriculture, workers’ compensation, professional lines of insurance and property, catastrophe, casualty, agriculture, marine, aerospace, and surety and other specialty lines of reinsurance. We maintain excellent financial strength as evidenced by the ratings of A (Excellent) from A.M. Best (XV size category) and A (Strong) from Standard and Poor’s on our principal operating subsidiaries. Endurance’s headquarters are located at Wellesley House, 90 Pitts Bay Road, Pembroke HM 08, Bermuda and its mailing address is Endurance Specialty Holdings Ltd., Suite No. 784, No. 48 Par-la-Ville Road, Hamilton HM 11, Bermuda. For more information about Endurance, please visit www.endurance.bm.

Safe Harbor for Forward-Looking Statements

Some of the statements in this press release may include forward-looking statements which reflect our current views with respect to future events and financial performance. Such statements may include forward-looking statements both with respect to us in general and the insurance and reinsurance sectors specifically, both as to underwriting and investment matters. Statements which include the words “should,” “expect,” “intend,” “plan,” “believe,” “project,” “anticipate,” “seek,” “will,” and similar statements of a future or forward-looking nature identify forward-looking statements in this press release for purposes of the U.S. federal securities laws or otherwise. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in the Private Securities Litigation Reform Act of 1995.

All forward-looking statements address matters that involve risks and uncertainties. Accordingly, there are or may be important factors that could cause actual results to differ from those indicated in the forward-looking statements. These factors include, but are not limited to, the effects of competitors’ pricing policies, greater frequency or severity of claims and loss activity, changes in market conditions in the agriculture insurance industry, termination of or changes in the terms of the U.S. multiple peril crop insurance program, a decreased demand for property and casualty insurance or reinsurance, changes in the availability, cost or quality of reinsurance or retrocessional coverage, our inability to renew business previously underwritten or acquired, our inability to maintain our applicable financial strength ratings, our inability to effectively integrate acquired operations, uncertainties in our reserving process, changes to our tax status, changes in insurance regulations, reduced acceptance of our existing or new products and services, a loss of business from and credit risk related to our broker counterparties, assessments for high risk or otherwise uninsured individuals, possible terrorism or the outbreak of war, a loss of key personnel, political conditions, changes in insurance regulation, changes in accounting policies, our investment performance, the valuation of our invested assets, a breach of our investment guidelines, the unavailability of capital in the future, developments in the world’s financial and capital markets and our access to such markets, government intervention in the insurance and reinsurance industry, illiquidity in the credit markets, changes in general economic conditions and other factors described in our Annual Report on Form 10-K for the year ended December 31, 2009.

Forward-looking statements speak only as of the date on which they are made, and we undertake no obligation publicly to update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.

ENDURANCE SPECIALTY HOLDINGS LTD.

CONSOLIDATED BALANCE SHEETS

(in thousands of United States dollars, except share and per share amounts)

		December 31,				December 31,
		2010				2009
Assets
Cash and cash equivalents		$	609,852			$	528,944
Fixed maturity investments, available for sale, at fair value			5,116,702				4,548,618
Short term investments, available for sale, at fair value			70,444				534,678
Preferred equity securities, available for sale, at fair value			13,565				11,023
Other investments			376,652				351,352
Premiums receivable, net			827,609				565,348
Deferred acquisition costs			154,484				146,979
Securities lending collateral			59,886				66,913
Prepaid reinsurance premiums			107,977				120,941
Losses recoverable			319,349				467,664
Accrued investment income			32,934				30,367
Goodwill and intangible assets			181,954				191,450
Deferred tax assets			33,684				17,252
Receivable on pending investment sales			602				632
Other assets			73,711				84,533
Total Assets		$	7,979,405			$	7,666,694
Liabilities
Reserve for losses and loss expenses		$	3,319,927			$	3,157,026
Reserve for unearned premiums			842,154				832,561
Net deposit liabilities			32,505				42,638
Securities lending payable			59,886				66,968
Reinsurance balances payable			228,860				220,435
Debt			528,411				447,664
Payable on pending investment purchases			—				25
Other liabilities			119,509				112,094
Total Liabilities			5,131,252				4,879,411
Shareholders’ Equity
Preferred shares
Series A, non-cumulative — 8,000,000 issued and outstanding (2009 — 8,000,000)			8,000				8,000
Common shares
47,218,468 issued and outstanding (2009 — 55,115,702)			47,218				55,116
Additional paid-in capital			613,915				929,577
Accumulated other comprehensive income			138,571				52,148
Retained earnings			2,040,449				1,742,442
Total Shareholders’ Equity			2,848,153				2,787,283
Total Liabilities and Shareholders’ Equity		$	7,979,405			$	7,666,694
Book Value per Common Share
Dilutive common shares outstanding			50,210,614				57,996,331
Diluted book value per common share[a]		$	52.74			$	44.61

ENDURANCE SPECIALTY HOLDINGS LTD.

CONSOLIDATED STATEMENTS OF INCOME

(in thousands of United States dollars, except share and per share amounts)

		Quarter Ended								For the Year Ended
		December 31,				December 31,				December 31,				December 31,
		2010				2009				2010				2009
Revenues
Gross premiums written		$	189,225			$	209,367			$	2,053,236			$	2,021,450
Net premiums written		$	158,115			$	146,442			$	1,763,744			$	1,606,050
Change in unearned premiums			291,621				247,501				(22,631	)			27,142
Net premiums earned			449,736				393,943				1,741,113				1,633,192
Other underwriting income (loss)			410				(284	)			(1,636	)			3,914
Net investment income			56,874				59,257				200,358				284,200
Net realized gains on investment sales			7,314				3,166				22,488				6,303
Total other-than-temporary impairment losses			(48	)			(561	)			(2,695	)			(50,993	)
Portion of loss recognized in accumulated other comprehensive income			(663	)			(423	)			(1,249	)			30,742
Net impairment losses recognized in earnings			(711	)			(984	)			(3,944	)			(20,251	)
Total revenues			513,623				455,098				1,958,379				1,907,358
Expenses
Losses and loss expenses			246,424				164,005				1,038,100				866,640
Acquisition expenses			66,133				72,821				264,228				267,971
General and administrative expenses			67,756				57,932				241,920				237,154
Amortization of intangibles			2,696				2,699				10,460				10,463
Net foreign exchange losses (gains)			3,476				1,008				(2,989	)			(29,740	)
Interest expense			9,053				7,541				34,762				30,174
Total expenses			395,538				306,006				1,586,481				1,382,662
Income before income taxes			118,085				149,092				371,898				524,696
Income tax (expense) benefit			(6,857	)			5,733				(7,160	)			11,408
Net income			111,228				154,825				364,738				536,104
Preferred dividends			(3,875	)			(3,875	)			(15,500	)			(15,500	)
Net income available to common and participating common shareholders		$	107,353			$	150,950			$	349,238			$	520,604
Per share data
Basic earnings per common share		$	2.22			$	2.69			$	6.73			$	9.14
Diluted earnings per common share		$	2.09			$	2.56			$	6.38			$	8.69

ENDURANCE SPECIALTY HOLDINGS LTD.

RESULTS BY SEGMENT

(in thousands of United States dollars)

		For the quarter ended December 31, 2010
		Insurance				Reinsurance				Reported Totals
Revenues
Gross premiums written		$	112,664			$	76,561			$	189,225
Ceded premiums written			(31,021	)			(89	)			(31,110	)
Net premiums written			81,643				76,472				158,115
Net premiums earned			205,528				244,208				449,736
Other underwriting income			4				406				410
Total underwriting revenues			205,532				244,614				450,146
Expenses
Net losses and loss expenses			129,168				117,256				246,424
Acquisition expenses			12,220				53,913				66,133
General and administrative expenses			36,812				30,944				67,756
			178,200				202,113				380,313
Underwriting income		$	27,332			$	42,501			$	69,833
Net loss ratio			62.9	%			48.0	%			54.8	%
Acquisition expense ratio			5.9	%			22.1	%			14.7	%
General and administrative expense ratio			17.9	%			12.7	%			15.1	%
Combined ratio			86.7	%			82.8	%			84.6	%

ENDURANCE SPECIALTY HOLDINGS LTD.

RESULTS BY SEGMENT

(in thousands of United States dollars)

		For the quarter ended December 31, 2009
		Insurance				Reinsurance				Reported Totals
Revenues
Gross premiums written		$	150,471			$	58,896			$	209,367
Ceded premiums written			(62,039	)			(886	)			(62,925	)
Net premiums written			88,432				58,010				146,442
Net premiums earned			191,151				202,792				393,943
Other underwriting income (loss)			89				(373	)			(284	)
Total underwriting revenues			191,240				202,419				393,659
Expenses
Net losses and loss expenses			119,297				44,708				164,005
Acquisition expenses			18,619				54,202				72,821
General and administrative expenses			28,813				29,119				57,932
			166,729				128,029				294,758
Underwriting income		$	24,511			$	74,390			$	98,901
Net loss ratio			62.4	%			22.0	%			41.6	%
Acquisition expense ratio			9.7	%			26.7	%			18.5	%
General and administrative expense ratio			15.1	%			14.4	%			14.7	%
Combined ratio			87.2	%			63.1	%			74.8	%

ENDURANCE SPECIALTY HOLDINGS LTD.

RESULTS BY SEGMENT

(in thousands of United States dollars)

		For the year ended December 31, 2010
		Insurance				Reinsurance				Reported Totals
Revenues
Gross premiums written		$	1,112,192			$	941,044			$	2,053,236
Ceded premiums written			(282,328	)			(7,164	)			(289,492	)
Net premiums written			829,864				933,880				1,763,744
Net premiums earned			821,828				919,285				1,741,113
Other underwriting income (loss)			475				(2,111	)			(1,636	)
Total underwriting revenues			822,303				917,174				1,739,477
Expenses
Net losses and loss expenses			558,040				480,060				1,038,100
Acquisition expenses			63,556				200,672				264,228
General and administrative expenses			123,335				118,585				241,920
			744,931				799,317				1,544,248
Underwriting income		$	77,372			$	117,857			$	195,229
Net loss ratio			67.9	%			52.2	%			59.6	%
Acquisition expense ratio			7.7	%			21.8	%			15.2	%
General and administrative expense ratio			15.0	%			12.9	%			13.9	%
Combined ratio			90.6	%			86.9	%			88.7	%

ENDURANCE SPECIALTY HOLDINGS LTD.

RESULTS BY SEGMENT

(in thousands of United States dollars)

		For the year ended December 31, 2009
		Insurance				Reinsurance				Reported Totals
Revenues
Gross premiums written		$	1,152,150			$	869,300			$	2,021,450
Ceded premiums written			(411,840	)			(3,560	)			(415,400	)
Net premiums written			740,310				865,740				1,606,050
Net premiums earned			823,703				809,489				1,633,192
Other underwriting income			3,533				381				3,914
Total underwriting revenues			827,236				809,870				1,637,106
Expenses
Net losses and loss expenses			553,008				313,632				866,640
Acquisition expenses			84,724				183,247				267,971
General and administrative expenses			119,766				117,388				237,154
			757,498				614,267				1,371,765
Underwriting income		$	69,738			$	195,603			$	265,341
Net loss ratio			67.1	%			38.8	%			53.1	%
Acquisition expense ratio			10.3	%			22.6	%			16.4	%
General and administrative expense ratio			14.6	%			14.5	%			14.5	%
Combined ratio			92.0	%			75.9	%			84.0	%

ENDURANCE SPECIALTY HOLDINGS LTD.

CONSOLIDATED FINANCIAL RATIOS

As Reported

		For the quarter ended December 31
		Insurance								Reinsurance								Total
		2010				2009				2010				2009				2010				2009
Net loss ratio			62.9	%			62.4	%			48.0	%			22.0	%			54.8	%			41.6	%
Acquisition expense ratio			5.9	%			9.7	%			22.1	%			26.7	%			14.7	%			18.5	%
General and administrative expense ratio			17.9	%			15.1	%			12.7	%			14.4	%			15.1	%			14.7	%
Combined ratio			86.7	%			87.2	%			82.8	%			63.1	%			84.6	%			74.8	%

Effect of Prior Year Net Loss Reserve Development

Favorable / (Unfavorable)

		For the quarter ended December 31
		Insurance								Reinsurance								Total
		2010				2009				2010				2009				2010				2009
Net loss ratio			5.6	%			11.2	%			4.9	%			9.7	%			5.2	%			10.5	%

Net of Prior Year Net Loss Reserve Development

		For the quarter ended December 31
		Insurance								Reinsurance								Total
		2010				2009				2010				2009				2010				2009
Net loss ratio			68.5	%			73.6	%			52.9	%			31.7	%			60.0	%			52.1	%
Acquisition expense ratio			5.9	%			9.7	%			22.1	%			26.7	%			14.7	%			18.5	%
General and administrative expense ratio			17.9	%			15.1	%			12.7	%			14.4	%			15.1	%			14.7	%
Combined ratio			92.3	%			98.4	%			87.7	%			72.8	%			89.8	%			85.3	%

The combined ratio is the sum of the loss, acquisition expense and general and administrative expense ratios. Endurance presents the combined ratio as a measure that is commonly recognized as a standard of performance by investors, analysts, rating agencies and other users of its financial information. The combined ratio, excluding prior year net loss reserve development, enables investors, analysts, rating agencies and other users of its financial information to more easily analyze Endurance’s results of underwriting activities in a manner similar to how management analyzes Endurance’s underlying business performance. The combined ratio, net of prior year net loss reserve development, should not be viewed as a substitute for the combined ratio.

ENDURANCE SPECIALTY HOLDINGS LTD.

CONSOLIDATED FINANCIAL RATIOS

As Reported

		For the year ended December 31
		Insurance								Reinsurance								Total
		2010				2009				2010				2009				2010				2009
Net loss ratio			67.9	%			67.1	%			52.2	%			38.8	%			59.6	%			53.1	%
Acquisition expense ratio			7.7	%			10.3	%			21.8	%			22.6	%			15.2	%			16.4	%
General and administrative expense ratio			15.0	%			14.6	%			12.9	%			14.5	%			13.9	%			14.5	%
Combined ratio			90.6	%			92.0	%			86.9	%			75.9	%			88.7	%			84.0	%

Effect of Prior Year Net Loss Reserve Development

Favorable / (Unfavorable)

		For the year ended December 31
		Insurance								Reinsurance								Total
		2010				2009				2010				2009				2010				2009
Net loss ratio			5.7	%			11.2	%			8.7	%			7.3	%			7.3	%			9.2	%

Net of Prior Year Net Loss Reserve Development

		For the year ended December 31
		Insurance								Reinsurance								Total
		2010				2009				2010				2009				2010				2009
Net loss ratio			73.6	%			78.3	%			60.9	%			46.1	%			66.9	%			62.3	%
Acquisition expense ratio			7.7	%			10.3	%			21.8	%			22.6	%			15.2	%			16.4	%
General and administrative expense ratio			15.0	%			14.6	%			12.9	%			14.5	%			13.9	%			14.5	%
Combined ratio			96.3	%			103.2	%			95.6	%			83.2	%			96.0	%			93.2	%

The combined ratio is the sum of the loss, acquisition expense and general and administrative expense ratios. Endurance presents the combined ratio as a measure that is commonly recognized as a standard of performance by investors, analysts, rating agencies and other users of its financial information. The combined ratio, excluding prior year net loss reserve development, enables investors, analysts, rating agencies and other users of its financial information to more easily analyze Endurance’s results of underwriting activities in a manner similar to how management analyzes Endurance’s underlying business performance. The combined ratio, excluding prior year net loss reserve development, should not be viewed as a substitute for the combined ratio.

ENDURANCE SPECIALTY HOLDINGS LTD.

GROSS AND NET PREMIUMS WRITTEN BY SEGMENT

(in thousands of United States dollars)

The following tables show Endurance’s gross and net premiums written for the quarters and years ended December 31, 2010 and 2009:

		Quarter Ended								Quarter Ended
		December 31, 2010								December 31, 2009
		Gross Premiums				Net Premiums				Gross Premiums				Net Premiums
		Written				Written				Written				Written
Insurance
Agriculture		$	6,930			$	2,372			$	33,430			$	697
Professional lines			36,690				33,171				49,915				44,456
Casualty			37,377				25,536				31,680				19,875
Property			22,134				11,895				26,479				14,932
Healthcare liability			10,811				9,946				9,650				9,129
Workers’ compensation			(1,278	)			(1,277	)			(683	)			(657	)
Subtotal Insurance		$	112,664			$	81,643			$	150,471			$	88,432
Reinsurance
Catastrophe		$	17,896			$	17,896			$	13,939			$	12,753
Casualty			47,970				47,965				34,543				34,537
Property			8,628				8,628				9,710				9,710
Aerospace and Marine			2,380				2,380				1,716				1,721
Surety and other specialty			(313	)			(397	)			(1,012	)			(711	)
Subtotal Reinsurance		$	76,561			$	76,472			$	58,896			$	58,010
Total		$	189,225			$	158,115			$	209,367			$	146,442

ENDURANCE SPECIALTY HOLDINGS LTD.

GROSS AND NET PREMIUMS WRITTEN BY SEGMENT

(in thousands of United States dollars)

		Year Ended								Year Ended
		December 31, 2010								December 31, 2009
		Gross Premiums				Net Premiums				Gross Premiums				Net Premiums
		Written				Written				Written				Written
Insurance
Agriculture		$	567,461			$	404,767			$	572,096			$	324,480
Professional lines			170,146				148,717				193,799				167,091
Casualty			167,549				107,801				152,580				91,071
Property			122,110				88,299				124,621				68,011
Healthcare liability			87,593				82,893				82,955				78,284
Workers’ compensation			(2,667	)			(2,613	)			26,099				11,373
Subtotal Insurance		$	1,112,192			$	829,864			$	1,152,150			$	740,310
Reinsurance
Catastrophe		$	309,886			$	305,617			$	303,404			$	302,218
Casualty			294,030				293,222				255,142				254,897
Property			224,544				224,544				215,085				215,085
Aerospace and Marine			48,761				46,696				44,696				42,563
Surety and other specialty			63,823				63,801				50,973				50,977
Subtotal Reinsurance		$	941,044			$	933,880			$	869,300			$	865,740
Total		$	2,053,236			$	1,763,744			$	2,021,450			$	1,606,050

ENDURANCE SPECIALTY HOLDINGS LTD.

RECONCILIATIONS

(in thousands of United States dollars, except share and per share amounts)

The following is a reconciliation of Endurance’s net income, net income per diluted common share, net income allocated to common shareholders under the two-class method and annualized return on average common equity to operating income, operating income per diluted common share, operating income allocated to common shareholders under the two-class method and annualized operating return on average common equity (all non-GAAP measures) for the quarters and years ended December 31, 2010 and 2009:

		Quarter Ended								Year Ended
		December 31,								December 31,
		2010				2009				2010				2009
Net income		$	111,228			$	154,825			$	364,738			$	536,104
(Less) Add after-tax items:
Net foreign exchange losses (gains)			3,496				1,116				(2,967	)			(29,372	)
Net realized gains on investment sales			(7,176	)			(3,262	)			(20,180	)			(6,281	)
Net impairment losses recognized in earnings			712				984				3,944				20,251
Operating income before preferred dividends		$	108,260			$	153,663			$	345,535			$	520,702
Preferred dividends			(3,875	)			(3,875	)			(15,500	)			(15,500	)
Operating income available to common and participating common shareholders		$	104,385			$	149,788			$	330,035			$	505,202
Operating income allocated to common shareholders under the two-class method		$	102,405			$	147,397			$	323,800			$	496,366
Weighted average dilutive common shares			50,302,939				58,052,021				53,728,459				58,874,114
Operating income per diluted common share		$	2.04			$	2.54			$	6.03			$	8.43
Average common equity [a]		$	2,683,919			$	2,547,817			$	2,617,718			$	2,297,283
Operating return on average common equity			3.9	%			5.9	%			12.6	%			22.0	%
Annualized operating return on average common equity			15.6	%			23.5	%			12.6	%			22.0	%
Net income		$	111,228			$	154,825			$	364,738			$	536,104
Preferred dividends			(3,875	)			(3,875	)			(15,500	)			(15,500	)
Net income available to common and participating common shareholders		$	107,353			$	150,950			$	349,238			$	520,604
Net income allocated to common shareholders under the two-class method		$	105,317			$	148,541			$	342,643			$	511,500
Net income per diluted common share		$	2.09			$	2.56			$	6.38			$	8.69
Return on average common equity, Net income			4.0	%			5.9	%			13.3	%			22.7	%
Annualized return on average common equity, Net income			16.0	%			23.7	%			13.3	%			22.7	%

Operating income and operating income per diluted common share are internal performance measures used by Endurance in the management of its operations. Operating income allocated to common shareholders (excludes unvested restricted shares outstanding which are considered participating) per diluted common share represents operating income divided by weighted average dilutive common shares, which has been calculated in accordance with the two-class method under U.S. GAAP. Operating income represents after-tax operational results excluding, as applicable, after-tax net realized capital gains or losses and after-tax net foreign exchange gains or losses because the amount of these gains or losses is heavily influenced by, and fluctuates in part, according to the availability of market opportunities. Endurance believes these amounts are largely independent of its business and underwriting process and including them distorts the analysis of trends in its operations. In addition to presenting net income and net income per dilutive common share determined in accordance with the two-class method under GAAP, Endurance believes that showing operating income and operating income per dilutive common share enables investors, analysts, rating agencies and other users of its financial information to more easily analyze Endurance’s results of operations in a manner similar to how management analyzes Endurance’s underlying business performance. Operating income and operating income per dilutive common share should not be viewed as substitutes for GAAP net income and net income per dilutive common share, respectively.

Endurance presents return on equity as a measure that is commonly recognized as a standard of performance by investors, analysts, rating agencies and other users of its financial information.

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