Syndicate 33

Hiscox PLC
01 December 2006


NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, IN OR INTO, THE UNITED STATES OF 
AMERICA

Hiscox completes sidecar transaction with WL Ross & Co

- Transaction will allow Hiscox to capitalise on strong underwriting conditions
- First sidecar transaction for the Lloyd's market

London, UK - Hiscox has announced today that, in order to take advantage of
strong underwriting opportunities particularly in US catastrophe risks, Hiscox
Syndicate 33 ('Syndicate 33 ') has entered into a Quota Share reinsurance
arrangement with Panther Re Bermuda Limited ( 'Panther Re'), a $360 million
(gross) Bermuda reinsurance company newly formed by WL Ross & Co. This follows
the announcement by Hiscox on 1 September 2006, that it was in discussions that
could lead to the creation of a new reinsurer. The Quota Share agreement will
allow Syndicate 33, which is managed and 72.5% owned by Hiscox, to grow its book
of property catastrophe reinsurance business during 2007 and 2008.

Under the Quota Share reinsurance agreement Panther Re will assume a 40% pro
rata share of Syndicate 33's property catastrophe reinsurance business for the
2007 underwriting year and a similar pro rata share to be agreed for the 2008
underwriting year. Panther Re's sole activity will be to participate in the
property catastrophe reinsurance business of its only client, Syndicate 33.
Under the Quota Share agreement Syndicate 33 will be entitled to a ceding
commission and a profit commission based on the underwriting results of Panther
Re.

The financing behind Panther Re comprises $144 million of equity and $216
million of term loans. WLR Recovery Fund III, L.P., a fund managed by WL Ross &
Co LLC, is the lead equity investor in the business. The net proceeds of the
financing will be placed in trust for Syndicate 33 as security for the
reinsurance.

Standard & Poor's Rating Services has assigned a BBB+ preliminary senior secured
bank loan rating to Panther Re's proposed $72 million Term A loan and its BB+
preliminary subordinated bank loan rating to Panther Re's proposed $144 million
Term B loan. Moody's Investor Service has assigned a Baa3 rating to Panther Re's
proposed $72 million Term A loan and a Ba2 rating to Panther Re's proposed $144
million Term B loan. Moody's Investor Services has also assigned a provisional
(P)A3 insurance financial strength rating to Panther Re. A. M. Best Company has
assigned a BBB- rating to the Term A loan and a BB rating to the Term B loan.

Goldman Sachs acted as sole financial advisor to Hiscox and lead arranger and
sole bookrunner in relation to the financing.

Bronek Masojada, Chief Executive Officer of Hiscox, said: 'This is the first
Lloyd's syndicate sidecar and we are delighted to have concluded the deal with
as eminent an investor as WL Ross & Co.

'Creating access to more capital will allow us to take advantage of what we
perceive will be a favourable market for writing catastrophe reinsurance
business in 2007 and 2008. Syndicate 33 will also benefit by increasing its
market presence and having more control over pricing and terms and conditions.

'This transaction further underlines our commitment to growing our business in
London whilst simultaneously growing our retail business in the UK, Europe and
the USA.'

Wilbur L. Ross Jr., CEO of WL Ross & Co. said: 'WL Ross & Co has been working
closely with the management of Hiscox for the last three months on this
transaction and has great respect for their reinsurance expertise. Panther is
our largest single investment in reinsurance. We continue to believe that
reinsurance rates and attachment levels now adequately reflect the risks of
natural catastrophe.'


                                      Ends



For further information please contact:

Name                                 Company       Telephone        Email
Bronek Masojada, Chief Executive     Hiscox        020 7448 6012    [e-mail]
Stuart Bridges, Finance Director     Hiscox        020 7448 6013    [e-mail]
Charles Dupplin, Director of M & A   Hiscox        020 7448 6319    [e-mail]

Sebastian St John Clarke,
Group Communications                 Hiscox        020 7448 6458    [e-mail]
Suzanne Bartch                       Maitland      020 7379 5151    [e-mail]
Wilbur L. Ross, Jr                   WL Ross & Co. [phone]  [e-mail]
                                
                                   

Notes to editors


About Hiscox
Hiscox plc is a specialist insurance group listed on the London Stock Exchange.
There are three main underwriting parts of the Group - Hiscox Global Markets,
Hiscox UK and Europe, and Hiscox International.  Hiscox Global Markets
underwrites mainly internationally traded business in the London Market -
generally large or complex business which needs to be shared with other insurers
or needs the international licences of Lloyd's. Hiscox UK and Hiscox Europe
offer a range of specialist insurance for professionals and business customers,
as well as high net worth individuals. Hiscox International includes offshore
operations in Bermuda and Guernsey and Hiscox USA.

For more information go to www.hiscox.com

About WL Ross & Co.
WL Ross & Co. LCC manages over $4.5 billion in assets for institutional
investors in the US, Europe and Asia, where it has investments in the steel,
coal, textile, automotive and financial service industries. WL Ross & Co.'s
experience in investing in insurance companies includes Montpelier Re, Blue
Ocean Re, Insuratex and Tong Yang Life. The principal, Wilbur L. Ross Jr., is
known for successfully restructuring companies in industries such as steel,
coal, telecommunication, foreign investment and textiles. Wilbur L. Ross Jr. is
on the board of International Textile Group, and International Coal Group in the
US, Blue Ocean Re, Montpelier Re Holdings Ltd, and Insuratex, Ltd. in Bermuda,
and Mittal Steel Company, Nikko Electric Industry Co. Ltd., Ohizumi
Manufacturing Co, International Auto Components, Plascar S.A. in Brazil and
Wagon PLC in Europe and Asia.

This press release contains 'forward looking statements' which include all
statements that do not relate solely to historical or current facts. All forward
looking statements rely on assumptions concerning future events and are subject
to a number of uncertainties and other factors which could cause actual results
to differ materially from such statements. This announcement does not constitute
or form any part of any offer or invitation to subscribe for, underwrite or
otherwise acquire, or any solicitation of any offer to purchase or subscribe for
securities whether in the United States or elsewhere.
Any failure to comply with this restriction may constitute a violation of US
securities law. No securities have been or will be registered under the US
Securities Act of 1933, as amended (the 'Securities Act') in connection with
this transaction and therefore may not be offered or sold in the United States
unless they are registered under the Securities Act or pursuant to an available
exemption therefrom. No public offering of securities is being made in the
United States.



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