Exhibit 99.1

FOR IMMEDIATE RELEASE

ALLIED WORLD REPORTS $93.8 MILLION NET INCOME IN SECOND QUARTER 2011 DESPITE CATASTROPHE
LOSSES; 3.3% QUARTERLY INCREASE IN DILUTED BOOK VALUE PER SHARE

ZUG, SWITZERLAND, August 3, 2011 — Allied World Assurance Company Holdings, AG (NYSE: AWH) today reported net income of $93.8 million, or $2.36 per diluted share, for the second quarter of 2011 compared to net income of $184.0 million, or $3.47 per diluted share, for the second quarter of 2010. Net income for the six months ended June 30, 2011 was $102.4 million, or $2.57 per diluted share, compared to net income of $317.7 million, or $5.98 per diluted share, for the first six months of 2010.

The company reported operating income of $44.2 million, or $1.11 per diluted share, for the second quarter of 2011 compared to operating income of $95.7 million, or $1.80 per diluted share, for the second quarter of 2010. Operating income for the six months ended June 30, 2011 was $2.8 million, or $0.07 per diluted share, compared to operating income of $157.0 million, or $2.96 per diluted share, for the first six months of 2010.

President and Chief Executive Officer Scott Carmilani commented, “Allied World’s demonstrated track record of profitably managing our business through challenging markets was again on display this quarter. Despite continued industry-wide catastrophe losses, we have again contained our share of these losses as a percentage of equity well below the industry average. Simultaneously, we continue to build out our specialty insurance franchise highlighted by the 20% growth experienced in our U.S. insurance segment in the quarter. This segment continues to gain traction in targeted specialty lines due to our expansion efforts and new business initiatives over the last three years.

“During the quarter, the company’s financial strength rating was upgraded to A ‘Strong’ by Standard & Poor’s. We are gratified that our efforts in building a strong, well-controlled, profitable specialty insurance and reinsurance franchise have resulted in this upgrade.”

Mr. Carmilani continued, “We remain excited about our pending merger of equals with Transatlantic and believe that the combination will create a truly global insurance and reinsurance franchise. Upon closing the merger in the fourth quarter, Allied World and Transatlantic will become TransAllied, operating with very strong financial strength ratings, enhanced competitive strength and a significant global presence. I am confident we are well positioned for continued success as we build a more formidable franchise with a record of success throughout all turns in the insurance and reinsurance market cycle.”

Underwriting Results

Gross premiums written were $519.6 million in the second quarter of 2011, a 5.2% increase compared to $493.8 million in the second quarter of 2010. For the six months ended June 30, 2011, gross premiums written totaled $1,080.3 million, an 8.2% increase compared to $998.0 million in the first six months of 2010. These increases were primarily due to the expansion of our global operating platforms and the introduction of new products.

Net premiums written were $395.8 million in the second quarter of 2011, a 7.0% increase compared to $369.8 million in the second quarter of 2010. For the six months ended June 30, 2011, net premiums written totaled $876.7 million, a 9.2% increase compared to $803.1 million in the first six months of 2010.

The combined ratio was 97.4% in the second quarter of 2011 compared to 87.0% in the second quarter of 2010. The loss and loss expense ratio was 66.4% in the second quarter of 2011 compared to 55.7% in the second quarter of 2010. During the second quarter of 2011, the company recorded net favorable reserve development on prior loss years of $55.2 million. This favorable reserve development and the impact of a commutation adjustment resulted in a benefit of 15.8 percentage points to the company’s loss and loss expense ratio for the quarter. This compares to the second quarter of 2010, where the company recorded net favorable reserve development on prior loss years of $64.1 million, a benefit of 18.9 percentage points to the company’s loss and loss expense ratio for that quarter. Absent these adjustments, the loss and loss expense ratio for the second quarter of 2011 was 82.2% compared to 74.6% for the second quarter of 2010. The second quarter 2011 loss and loss expense ratio was impacted by $67.5 million of net losses, or 19.0 percentage points, from U.S. weather-related events during the quarter and additional losses developing from first quarter catastrophes. These catastrophe losses were comprised of $5.0 million from our U.S. insurance segment, $30.5 million from our international insurance segment and $32.0 million from our reinsurance segment. The second quarter 2010 loss and loss expense ratio was impacted by losses of $30.0 million, or 8.9 percentage points, from major loss events during that quarter.

The company’s expense ratio was 31.0% for the second quarter of 2011 compared to 31.3% for the second quarter of 2010. The expense ratio was 31.3% for the six months ended June 30, 2011 compared to 31.0% in the first six months of 2010.

Investment Results

The total return on the company’s investment portfolio for the three and six months ended June 30, 2011 was 1.3% and 2.2%, respectively. See table below for the components of our investment returns for the first half of 2011 and 2010:

		SIX MONTHS ENDED				SIX MONTHS ENDED
(Expressed in thousands of United States Dollars)		JUNE 30, 2011				JUNE 30, 2010
Net investment income		$	102,576			$	134,496
Net realized investment gains			109,254				176,378
Change in unrealized investment gains			(36,465	)			(12,294	)
Net investment income, realized gains and unrealized gains		$	175,365			$	298,580
Average invested assets		$	7,888,212			$	7,737,287
Financial statement portfolio return			2.2	%			3.9	%

Shareholders’ Equity

As of June 30, 2011, our total shareholders’ equity was $3.0 billion, compared to $3.1 billion as of December 31, 2010.

The company’s annualized net income return on average shareholders’ equity for the three and six months ended June 30, 2011 was 12.6% and 6.8%, respectively. The company’s annualized operating return on average shareholders’ equity for the three and six months ended June 30, 2011 was 6.0% and 0.2%, respectively.

Share Repurchase Program

As of June 30, 2011, diluted book value per share was $76.68, an increase of 3.2% compared to $74.29 as of December 31, 2010. For the first six months of 2011, the company repurchased 969,163 of its common shares under its share repurchase program at an average repurchase price of $61.91 per share for an aggregate cost of $60.0 million. This plan was inactive in the second quarter of 2011 because of the merger negotiations with Transatlantic Holdings, Inc. As of June 30, 2011, the company had $200.9 million of remaining capacity available under the share repurchase program.

Investment Supplement

Allied World will be providing additional information on its investment portfolio as of June 30, 2011. This information will be available at the “Investor Relations” section of the company’s website at www.awac.com.

Financial Supplement

A financial supplement relating to the second quarter of 2011 will be available at the “Investor Relations” section of the company’s website at www.awac.com.

Loss Reserve Triangles

Allied World announced today that it is publishing its 2010 Global Loss Triangles. The loss data in this report will be presented on an accident and treaty-year basis and will include information for the company’s cumulative paid and reported loss and allocated loss adjustment expenses as of December 31, 2010. This information will be presented both gross and net of external reinsurance and is organized into reserving classes of business that fall within the company’s direct insurance and reinsurance businesses. This report will be available at the “Investor Relations” section of the company’s website at www.awac.com.

Conference Call

Allied World will host a conference call on Thursday, August 4, 2011 at 9:00 a.m. (Eastern Time) to discuss the second quarter 2011 financial results. The public may access a live webcast of the conference call at the “Investor Relations” section of the company’s website at www.awac.com. In addition, the conference call can be accessed by dialing (877) 317-6701 (U.S. and Canada callers) or (412) 317-6701 (international callers) and entering the passcode 5885208 approximately ten minutes prior to the call.

Following the conclusion of the presentation, a replay of the call will be available through Thursday, August 18, 2011 by dialing (877)
344-7529 (U.S. and Canada callers) or (412) 317-0088 (international callers) and entering the passcode 10001916. In addition, the webcast will remain available online through Thursday, August 18, 2011 at www.awac.com.

Non-GAAP Financial Measures

In presenting the company’s results, management has included and discussed in this press release certain non-generally accepted accounting principles (“non-GAAP”) financial measures within the meaning of Regulation G as promulgated by the U.S. Securities and Exchange Commission. Management believes that these non-GAAP measures, which may be defined differently by other companies, better explain the company’s results of operations in a manner that allows for a more complete understanding of the underlying trends in the company’s business. However, these measures should not be viewed as a substitute for those determined in accordance with generally accepted accounting principles (“U.S. GAAP”).

“Operating income” is an internal performance measure used in the management of the company’s operations and represents after-tax operational results excluding, as applicable, net realized investment gains or losses, net impairment charges recognized in earnings, impairment of intangible assets and foreign exchange gain or loss. The company excludes net realized investment gains or losses, net impairment charges recognized in earnings and net foreign exchange gain or loss from the calculation of operating income because the amount of these gains or losses is heavily influenced by and fluctuates in part according to the availability of market opportunities and other factors. The company excludes impairment of intangible assets as these are non-recurring charges. In addition to presenting net income determined in accordance with U.S. GAAP, the company believes that showing operating income enables investors, analysts, rating agencies and other users of the company’s financial information to more easily analyze our results of operations and underlying business performance. Operating income should not be viewed as a substitute for U.S. GAAP net income.

The company has included “diluted book value per share” because it takes into account the effect of dilutive securities; therefore, the company believes it is an important measure of calculating shareholder returns.

“Annualized net income return on average shareholders’ equity” (“ROAE”) is calculated using average shareholders’ equity, excluding the average after tax unrealized gains (or losses) on investments. Unrealized gains (losses) on investments are primarily the result of interest rate and credit spread movements and the resultant impact on fixed income securities. Such gains (losses) are not related to management actions or operational performance, nor are they likely to be realized. Therefore, the company believes that excluding these unrealized gains (losses) provides a more consistent and useful measurement of operating performance, which supplements U.S. GAAP information. In calculating

ROAE, the net income (loss) available to shareholders for the period is multiplied by the number of such periods in a calendar year in order to arrive at annualized net income (loss) available to shareholders. The company presents ROAE as a measure that is commonly recognized as a standard of performance by investors, analysts, rating agencies and other users of its financial information.

“Annualized operating return on average shareholders’ equity” is calculated using operating income (as defined above and annualized in the manner described for net income (loss) available to shareholders under ROAE above), and average shareholders’ equity, excluding the average after tax unrealized gains (losses) on investments. Unrealized gains (losses) are excluded from equity for the reasons outlined in the annualized net income return on average shareholders’ equity explanation above.

Reconciliations of these financial measures to their most directly comparable U.S. GAAP measures are included in the attached tables.

About Allied World Assurance Company

Allied World Assurance Company Holdings, AG, through its subsidiaries, is a global provider of innovative property, casualty and specialty insurance and reinsurance solutions, offering superior client service through a global network of offices and branches. All of Allied World’s rated insurance and reinsurance subsidiaries are rated A by A.M. Best Company, A by Standard & Poor’s, and A2 by Moody’s, and our Lloyd’s Syndicate 2232 is rated A+ by Standard & Poor’s and Fitch. Please visit www.awac.com for further information on Allied World.

Additional Information about the Proposed Merger and Where to Find It

This communication contains certain information relating to a proposed merger between Allied World and Transatlantic Holdings, Inc. (“Transatlantic”). In connection with the proposed merger, Allied World has filed with the U.S. Securities and Exchange Commission (the “SEC”) a registration statement on Form S-4 that includes a preliminary joint proxy statement/prospectus that provides details of the proposed merger and the attendant benefits and risks. This communication is not a substitute for the joint proxy statement/prospectus or any other document that Allied World or Transatlantic may file with the SEC or send to their shareholders in connection with the proposed merger. Investors and security holders are urged to read the registration statement on Form S-4, including the preliminary joint proxy statement/prospectus, and all other relevant documents filed with the SEC (including the definitive joint proxy statement/prospectus) or sent to shareholders as they become available because they will contain important information about the proposed merger. All documents, when filed, will be available free of charge at the SEC’s website (www.sec.gov). You may also obtain these documents by contacting Allied World’s Corporate Secretary, attn.: Wesley D. Dupont, at Allied World Assurance Company Holdings, AG, Lindenstrasse 8, 6340 Baar, Zug, Switzerland, or via e-mail at secretary@awac.com; or by contacting Transatlantic’s Investor Relations department at Transatlantic Holdings, Inc., 80 Pine Street, New York, New York 10005, or via e-mail at investor_relations@transre.com. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval.

Participants in the Solicitation

Allied World, Transatlantic and their respective directors and executive officers may be deemed to be participants in any solicitation of proxies in connection with the proposed merger. Information about Allied World’s directors and executive officers is available in Allied World’s proxy statement dated March 17, 2011 for its 2011 Annual Meeting of Shareholders. Information about Transatlantic’s directors and executive officers is available in Transatlantic’s proxy statement dated April 8, 2011 for its 2011 Annual Meeting of Shareholders. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, may be contained in the definitive joint proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the merger when they become available. Investors should read the definitive joint proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions.

Cautionary Statement Regarding Forward-Looking Statements

Any forward-looking statements made in this communication reflect Allied World’s current views with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties, which may cause actual results to differ materially from those set forth in these statements. For example, these forward-looking statements could be affected by the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; the inability to obtain Allied World’s or Transatlantic’s shareholder approval or the failure to satisfy other conditions to completion of the merger, including receipt of regulatory approvals; risks that the proposed transaction disrupts each company’s current plans and operations; the ability to retain key personnel; the ability to recognize the benefits of the merger; the amount of the costs, fees, expenses and charges related to the merger; pricing and policy term trends; increased competition; the impact of acts of terrorism and acts of war; greater frequency or severity of unpredictable catastrophic events; negative rating agency actions; the adequacy of Allied World’s loss reserves; Allied World or its non-U.S. subsidiaries becoming subject to significant income taxes in the United States or elsewhere; changes in regulations or tax laws; changes in the availability, cost or quality of reinsurance or retrocessional coverage; adverse general economic conditions; and judicial, legislative, political and other governmental developments, as well as management’s response to these factors, and other factors identified in Allied World’s filings with the SEC. You are cautioned not to place undue reliance on these forward-looking

statements, which speak only as of the date on which they are made. Allied World is under no obligation (and expressly disclaims any such obligation) to update or revise any forward-looking statement that may be made from time to time, whether as a result of new information, future developments or otherwise.

ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Expressed in thousands of United States dollars, except share and per share amounts)

		Quarter Ended June 30,								Six Months Ended June 30,
		2011				2010				2011				2010
Revenues:
Gross premiums written		$	519,598			$	493,847			$	1,080,286			$	998,010
Premiums ceded			(123,795	)			(124,052	)			(203,612	)			(194,923	)
Net premiums written			395,803				369,795				876,674				803,087
Change in unearned premiums			(40,496	)			(30,871	)			(186,491	)			(125,839	)
Net premiums earned			355,307				338,924				690,183				677,248
Net investment income			52,368				65,594				102,576				134,496
Net realized investment gains			58,878				94,933				109,254				172,420
Net impairment charges recognized in earnings			—				—				—				(168	)
Other income			—				616				—				913
Total revenue			466,553				500,067				902,013				984,909
Expenses:
Net losses and loss expenses			235,813				188,722				540,265				420,876
Acquisition costs			42,971				37,938				81,053				78,722
General and administrative expenses			67,201				68,089				135,157				131,552
Amortization and impairment of intangible assets			766				891				1,533				1,783
Interest expense			13,745				9,531				27,487				19,059
Foreign exchange loss			1,184				559				742				1,635
Total expenses			361,680				305,730				786,237				653,627
Income before income taxes			104,873				194,337				115,776				331,282
Income tax expense			11,073				10,378				13,356				13,583
NET INCOME		$	93,800			$	183,959			$	102,420			$	317,699
PER SHARE DATA:
Basic earnings per share		$	2.45			$	3.66			$	2.69			$	6.34
Diluted earnings per share		$	2.36			$	3.47			$	2.57			$	5.98
Weighted average common shares outstanding			38,346,489				50,222,974				38,061,724				50,123,945
Weighted average common shares and common share equivalents outstanding			39,800,753				52,974,410				39,873,418				53,086,708
Dividends paid per share		$	—			$	0.20			$	—			$	0.40

ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Expressed in thousands of United States dollars, except share and per share amounts)

		As of				As of
		June 30,				December 31,
		2011				2010
ASSETS:
Fixed maturity investments available for sale, at fair value (amortized cost: 2011: $318,711; 2010: $828,544)		$	345,551			$	891,849
Fixed maturity investments trading, at fair value			6,201,034				5,769,097
Equity securities trading, at fair value			393,913				174,976
Other invested assets trading, at fair value			562,267				347,632
Total investments			7,502,765				7,183,554
Cash and cash equivalents			807,657				853,368
Insurance balances receivable			653,002				529,927
Prepaid reinsurance			223,269				187,287
Reinsurance recoverable			1,013,951				927,588
Accrued investment income			39,582				40,520
Net deferred acquisition costs			112,083				96,803
Goodwill			268,376				268,376
Intangible assets			55,342				56,876
Net deferred tax assets			19,826				19,740
Other assets			54,760				75,184
Total assets		$	10,750,613			$	10,239,223
LIABILITIES:
Reserve for losses and loss expenses		$	5,251,304			$	4,879,188
Unearned premiums			1,184,676				962,203
Reinsurance balances payable			132,661				99,732
Net balances payable on purchases and sales of investments			252,351				318,570
Senior notes			797,823				797,700
Accounts payable and accrued liabilities			87,381				106,010
Total liabilities		$	7,706,196			$	7,163,403
SHAREHOLDERS’ EQUITY:
Common shares: par value CHF 15.00 per share (2011: 40,003,642; 2010: 40,003,642 shares issued and 2011: 37,945,043; 2010: 38,089,226 shares outstanding)			600,055				600,055
Additional paid-in capital			82,037				170,239
Treasury shares, at cost (2011: 2,058,599; 2010: 1,914,416)			(124,392	)			(112,811	)
Retained earnings			2,463,622				2,361,202
Accumulated other comprehensive income, net of tax			23,095				57,135
Total shareholders’ equity			3,044,417				3,075,820
Total liabilities and shareholders’ equity		$	10,750,613			$	10,239,223

ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED CONSOLIDATED SEGMENT DATA
(Expressed in thousands of United States dollars, except for ratio information)

		U.S.				International
Quarter Ended June 30, 2011		Insurance				Insurance				Reinsurance				Total
Gross premiums written		$	226,738			$	178,593			$	114,267			$	519,598
Net premiums written			172,887				108,985				113,931				395,803
Net premiums earned			145,857				79,956				129,494				355,307
Net losses and loss expenses			(92,595	)			(72,082	)			(71,136	)			(235,813	)
Acquisition costs			(18,876	)			747				(24,842	)			(42,971	)
General and administrative expenses			(31,253	)			(20,653	)			(15,295	)			(67,201	)
Underwriting income (loss)			3,133				(12,032	)			18,221				9,322
Net investment income															52,368
Net realized investment gains															58,878
Amortization and impairment of intangible assets															(766	)
Interest expense															(13,745	)
Foreign exchange loss															(1,184	)
Income before income taxes														$	104,873
GAAP Ratios:
Loss and loss expense ratio			63.5	%			90.2	%			54.9	%			66.4	%
Acquisition cost ratio			12.9	%			(0.9	%)			19.2	%			12.1	%
General and administrative expense ratio			21.4	%			25.8	%			11.8	%			18.9	%
Combined ratio			97.8	%			115.1	%			85.9	%			97.4	%

		U.S.				International
Quarter Ended June 30, 2010		Insurance				Insurance				Reinsurance				Total
Gross premiums written		$	189,663			$	167,601			$	136,583			$	493,847
Net premiums written			135,238				98,509				136,048				369,795
Net premiums earned			125,659				89,427				123,838				338,924
Other income			616				—				—				616
Net losses and loss expenses			(69,198	)			(64,580	)			(54,944	)			(188,722	)
Acquisition costs			(15,854	)			66				(22,150	)			(37,938	)
General and administrative expenses			(30,683	)			(22,657	)			(14,749	)			(68,089	)
Underwriting income			10,540				2,256				31,995				44,791
Net investment income															65,594
Net realized investment gains															94,933
Amortization and impairment of intangible assets															(891	)
Interest expense															(9,531	)
Foreign exchange loss															(559	)
Income before income taxes														$	194,337
GAAP Ratios:
Loss and loss expense ratio			55.1	%			72.2	%			44.4	%			55.7	%
Acquisition cost ratio			12.6	%			(0.1	%)			17.9	%			11.2	%
General and administrative expense ratio			24.4	%			25.3	%			11.9	%			20.1	%
Combined ratio			92.1	%			97.4	%			74.2	%			87.0	%

ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED CONSOLIDATED SEGMENT DATA
(Expressed in thousands of United States dollars, except for ratio information)

		U.S.				International
Six Months Ended June 30, 2011		Insurance				Insurance				Reinsurance				Total
| | | |
Gross premiums written		$	410,040			$	289,918			$	380,328			$	1,080,286
Net premiums written			312,789				183,895				379,990				876,674
Net premiums earned			281,338				156,246				252,599				690,183
Other income			—				—				—				—
Net losses and loss expenses			(208,426	)			(143,266	)			(188,573	)			(540,265	)
Acquisition costs			(36,978	)			2,603				(46,678	)			(81,053	)
General and administrative expenses			(62,052	)			(41,381	)			(31,724	)			(135,157	)
Underwriting loss			(26,118	)			(25,798	)			(14,376	)			(66,292	)
Net investment income															102,576
Net realized investment gains															109,254
Net impairment charges recognized in earnings															—
Amortization and impairment of intangible assets															(1,533	)
Interest expense															(27,487	)
Foreign exchange loss															(742	)
Income before income taxes														$	115,776
GAAP Ratios:
Loss and loss expense ratio			74.1	%			91.7	%			74.7	%			78.3	%
Acquisition cost ratio			13.1	%			(1.7	%)			18.5	%			11.7	%
General and administrative expense ratio			22.1	%			26.5	%			12.6	%			19.6	%
Combined ratio			109.3	%			116.5	%			105.8	%			109.6	%

		U.S.				International
Six Months Ended June 30, 2010		Insurance				Insurance				Reinsurance				Total
Gross premiums written		$	351,748			$	289,023			$	357,239			$	998,010
Net premiums written			266,793				179,590				356,704				803,087
Net premiums earned			254,864				176,470				245,914				677,248
Other income			913				—				—				913
Net losses and loss expenses			(167,623	)			(122,029	)			(131,224	)			(420,876	)
Acquisition costs			(32,814	)			—				(45,908	)			(78,722	)
General and administrative expenses			(57,797	)			(44,502	)			(29,253	)			(131,552	)
Underwriting (loss) income			(2,457	)			9,939				39,529				47,011
Net investment income															134,496
Net realized investment gains															172,420
Net impairment charges recognized in earnings															(168	)
Amortization and impairment of intangible assets															(1,783	)
Interest expense															(19,059	)
Foreign exchange loss															(1,635	)
Income before income taxes														$	331,282
GAAP Ratios:
Loss and loss expense ratio			65.8	%			69.1	%			53.4	%			62.1	%
Acquisition cost ratio			12.9	%			0.0	%			18.7	%			11.6	%
General and administrative expense ratio			22.7	%			25.2	%			11.9	%			19.4	%
Combined ratio			101.4	%			94.3	%			84.0	%			93.1	%

ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED OPERATING INCOME RECONCILIATION
(Expressed in thousands of United States dollars, except share and per share amounts)

		Quarter Ended June 30,								Six Months Ended June 30,
		2011				2010				2011				2010
Net income		$	93,800			$	183,959			$	102,420			$	317,699
Add after tax affect of:
Net realized investment gains			(50,795	)			(88,850	)			(100,320	)			(162,452	)
Net impairment charges recognized in earnings			—				—				—				109
Foreign exchange loss			1,184				559				742				1,635
Operating income		$	44,189			$	95,668			$	2,842			$	156,991
Weighted average common shares outstanding:
Basic			38,346,489				50,222,974				38,061,724				50,123,945
Diluted			39,800,753				52,974,410				39,873,418				53,086,708
Basic per share data:
Net income		$	2.45			$	3.66			$	2.69			$	6.34
Add after tax affect of:
Net realized investment gains			(1.32	)			(1.77	)			(2.64	)			(3.24	)
Net impairment charges recognized in earnings			—				—				—				—
Foreign exchange loss			0.02				0.01				0.03				0.03
Operating income		$	1.15			$	1.90			$	0.08			$	3.13
Diluted per share data
Net income		$	2.36			$	3.47			$	2.57			$	5.98
Add after tax affect of:
Net realized investment gains			(1.28	)			(1.68	)			(2.52	)			(3.05	)
Net impairment charges recognized in earnings			—				—				—				—
Foreign exchange loss			0.03				0.01				0.02				0.03
Operating income		$	1.11			$	1.80			$	0.07			$	2.96

ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED DILUTED BOOK VALUE PER SHARE RECONCILIATION
(Expressed in thousands of United States dollars, except share and per share amounts)

		As of				As of				As of
		June 30,				December 31,				June 30,
		2011				2010				2010
Price per share at period end		$	57.58			$	59.44			$	45.38
Total shareholders’ equity		$	3,044,417			$	3,075,820			$	3,468,543
Basic common shares outstanding			37,945,043				38,089,226				49,407,301
Add: unvested restricted share units			473,967				571,178				804,644
Add: Performance based equity awards			920,164				1,440,017				1,409,984
Add: employee purchase plan			—				10,576				—
Add: dilutive options/warrants outstanding			1,124,438				3,272,739				6,667,941
Weighted average exercise price per share		$	38.83			$	35.98			$	34.52
Deduct: options bought back via treasury method			(758,342	)			(1,980,884	)			(5,072,455	)
Common shares and common share equivalents outstanding			39,705,270				41,402,852				53,217,415
Basic book value per common share		$	80.23			$	80.75			$	70.20
Diluted book value per common share		$	76.68			$	74.29			$	65.18

ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED ANNUALIZED RETURN ON SHAREHOLDERS’ EQUITY RECONCILIATION
(Expressed in thousands of United States dollars, except for percentage information)

		Quarter Ended June 30,								Six Months Ended June 30,
		2011				2010				2011				2010
Opening shareholders’ equity		$	2,950,953			$	3,338,807			$	3,075,820			$	3,213,295
Deduct: accumulated other comprehensive income			(32,963	)			(142,284	)			(57,135	)			(149,849	)
Adjusted opening shareholders’ equity			2,917,990				3,196,523				3,018,685				3,063,446
Closing shareholders’ equity		$	3,044,417			$	3,468,543			$	3,044,417			$	3,468,543
Deduct: accumulated other comprehensive income			(23,095	)			(138,245	)			(23,095	)			(138,245	)
Adjusted closing shareholders’ equity			3,021,322				3,330,298				3,021,322				3,330,298
Average shareholders’ equity		$	2,969,656			$	3,263,411			$	3,020,004			$	3,196,872
Net income available to shareholders		$	93,800			$	183,959			$	102,420			$	317,699
Annualized net income available to shareholders			375,200				735,836				204,840				635,398
Annualized return on average shareholders’ equity — net income available to shareholders			12.6	%			22.5	%			6.8	%			19.9	%
Operating income available to shareholders		$	44,189			$	95,668			$	2,842			$	156,991
Annualized operating income available to shareholders			176,756				382,672				5,684				313,982
Annualized return on average shareholders’ equity — operating income available to shareholders			6.0	%			11.7	%			0.2	%			9.8	%

Source: Allied World Assurance Company Holdings, AG

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