As you well know, we’ve made it our business at QBE the Americas to grow, and grow profitably, by making intelligent and well-executed business acquisitions. Adding yet four more insurance groups in 2007 and early 2008 has further rounded out our insurance portfolio, created infrastructure synergies and allowed us to better serve you, our partners, and your clients.

That increased size and scope, however, has not minimized our focus on the local markets where our multiple business units operate or lessened our commitment to the partners who run our program business. We have continued to place an emphasis on our accessibility through a decentralized office structure and a strong commitment to company reps in the field who are available to meet your needs. We have maintained the focus on relationships that has made the business units in QBE the Americas so successful. We have expanded the role of our industry practice leaders to help us create competitive, opportunistic product offerings that address market needs now and in subsequent years.

2007 was an eventful year from beginning to end. It began with our offer to purchase Winterthur U.S. Holdings and ended with the creation of a specialty fine arts product that can be marketed by all our agency partners in all U.S. markets beginning in 2008. In between we closed the General Casualty/Unigard acquisition, giving us a “Main Street” property and casualty presence; completed the acquisition of Praetorian Financial Group, a premier specialty provider with significant size and a track record of profitable growth; and purchased Mexico’s Cumbre Seguros, bolstering our Latin American presence by gaining an established insurer widely used by U.S. companies that set up operations near the border. We also integrated more than 2,800 U.S. employees and over 30 office locations into our “one” QBE the Americas, successfully handled the worst that Mother Nature dished out in the Mid-Plains and tackled multiple large automation initiatives.

The numbers paint a bright picture as well. For 2007, we posted a combined ratio of 93.9, which is solid given competitive market conditions, prior- year reserve adjustments and large claim events that are a natural part of our business.

We posted $3.036 billion in gross written premiums, 110.8 percent higher than in 2006, due primarily to the $1.58 billion in premium writings from the Praetorian and Winterthur acquisitions. In general, premiums in all business units were held low by competitive market pressures, which limited year-over-year growth. While We don’t like to admit the market is soft, we all know that organic growth is tough in today’s environment. For this reason we believe our strategic acquisitions and the cross-selling opportunities afforded by them will boost results for years to come.

On January 3, 2008, we acquired North Pointe Holdings and its subsidiary Capital City Holding Company, which will further broaden our Specialty line offerings. We will take full advantage of the synergies available among our broad stable of business unit holdings. These include additional reinsurance contract restructurings, further coordinating the work of backroom IT and service functions, and joint product development and deployment across our widespread partner distribution channels. We will also expand in market segments that we believe will provide QBE with consistent returns over the long term. Our intent is not to make significant changes to the fine job our business units have been doing, but to fine-tune what they offer to put ourselves, and our partners, in a strong position for the future.

Over the past year we have shared with all QBE the Americas leaders and employees the essential behaviors that are core to QBE’s culture and values. These will ensure that at all times customer satisfaction, integrity, employee motivation and the long-term financial health of our stakeholders are at the forefront of everything we do. We believe that with your continued support and commitment to selling valuable products in the American insurance market, both your, and our, success will be assured.

Thank you for your partnership over the past 12 months. We look forward to accomplishing even more together in the years to come.

Lastly, We would like to thank our employees for all their efforts during a very busy year of acquisition and integration activities. We welcome our new employees to QBE!

~ the Executive Leadership Team ~