Introduction to Darwin

August 2006

Forward-Looking Statements

The following information includes forward-looking statements. All statements other than historical information or statements of current condition contained herein, including statements regarding our future financial performance, our business strategy and expected developments in the commercial insurance market, are forward-looking statements. The words "expect," "intend," "plan," "believe," "project," "may," "estimate," "continue," "anticipate," "will," and similar expressions of a future or forward-looking nature identify forward-looking statements.

We have based these forward-looking statements on management’s current expectations. These statements are subject to a number of risks, uncertainties and other factors that may cause actual events or results to differ materially from those expressed or implied by any of these statements. These statements should not be regarded as a representation by us, the underwriters or any other person that the anticipated events, future plans or other expectations will be achieved. We undertake no obligation to update publicly or review for any reason any forward-looking statement after the date of this presentation or to conform these statements to actual results or changes in our expectations. All subsequent written and oral forward-looking statements attributable to us or individuals acting on our behalf are expressly qualified in their entirety by this paragraph.

Neither the Private Securities Litigation Reform Act of 1995 nor Section 27A of the Securities Act of 1933 provides any protection to us for statements made in this presentation.

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Stephen Sills

Chairman, President & Chief Executive Officer

Introduction to Darwin

• Specialty insurer focused on professional liability coverages

• $165.8 million of gross premiums written in 2005

– Diversified across D&O, E&O and Medical Malpractice Liability

– Focused on small and middle market business

• Founded in 2003 by Stephen Sills and Alleghany Corporation

• Current ownership:

– 55% Alleghany / 35% Public / 10% Management

– Alleghany to continue as majority owner

• Rated “A-” (Excellent) by A.M. Best

Disciplined growth through specialized and proven expertise

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Darwin’s Successful IPO

• $96 million initial public offering completed on May 19, 2006

– Priced at $16.00 per share

• Currently trading at $20.00, up by 25% from offer

– Market capitalization of ~$340 million

• Offering reduced Alleghany’s ownership from 90% to 55%

• Increased future financial flexibility

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Darwin Investment Highlights

Deep and proven management team

Attractive market dynamics

Built to identify and underwrite profitable market niches

Select distribution network that understands Darwin’s risk parameters

Technology platform that enhances distribution and supports efficient operations

Integrated, disciplined underwriting culture

Ready for “loose bricks”

Strong capital base

=

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Continued Superior Growth

Darwin’s Management Team

Name Title Previous Experience Years Experience

Bob Asensio SVP – Chief Information Officer Executive Risk Inc. 25

Paul Martin SVP – Chief Actuary XL Vianet 30

David Newman SVP – Chief Underwriting Officer

Odyssey Re's London Market 29

Paul Romano SVP – Underwriting Executive Risk Inc. 25

Mark Rosen SVP and General Counsel Executive Risk Inc. 28

Jack Sennott Chief Financial Officer Executive Risk Inc. 18

Stephen Sills Chairman, President & CEO Executive Risk Inc. 30

Management will increase its ownership as part of the IPO

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Executive Risk Experience

The Executive Risk Experience

•Specialty insurer focused on professional liability

•Focus on “loose brick" opportunities

•Joint-accountability group

•Round table review of underwriting risks

•Profitable results from tactical strategy

–Approximately $1mm of GPW per employee

Executive Risk Return From IPO To Sale

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Source: SNL Financial

(1) Value at announcement of sale to Chubb

Enhancements to Proven Operating Model

• Focus on small accounts

• Select distribution

• Separation of “engineering” and “manufacturing”

• “Ground up” underwriting

• Technology geared to handle small accounts and to promote operational efficiency

• Profitable results from efficiency refinements

– Approximately $2mm of GPW per employee

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Attractive Market Dynamics

• Total market of $20 billion – room to grow

• Profitable pricing driven by poor industry underwriting results in late 1990s and early 2000s

• Companies without legacy issues are positioned for superior profitability

• Profits can be substantially accelerated by “loose bricks”

• In soft markets, profits can be protected by writing price-inelastic small account business

Market Opportunity Rate Changefrom 4Q ‘99 – 1Q ‘06

Darwin’s business model accentuates the impact of attractive market dynamics

Source: Council of Insurance Agents and Brokers

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Where We Make it Happen

A balanced business, responding to market opportunities

Total Premiums: $165.8 million

Total GPW Growth2005 Gross Premiums Written($ in millions)

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E&O 36%

D&O 20%

Medical Malpractice

44%

D&O Product Mix2005 Gross Premiums Written

Selected Classes Yearof Business Started

Public Accounts 2003Private Accounts 2003Employment Practices 2003Health Care Management Liability 2003Fiduciary 2004Non-profit Accounts 2005

D&O Premiums: $32.9 million

D&O GPW Growth

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E&O 36%

D&O 20%

Medical Malpractice

44%

($ in millions)

E&O Product Mix2005 Gross Premiums Written E&O GPW Growth

E&O Premiums: $58.9 million

Selected Classes Yearof Business Started

Managed Care E&O 2003

Lawyers Professional E&O 2003

Insurance Agents E&O 2003

Miscellaneous Professional E&O 2003

Technology E&O 2005

Municipal Entity and Public Officials E&O 2005

Insurance Company E&O 2006

($ in millions)

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E&O 36%

D&O 20%

Medical Malpractice

44%

Medical Malpractice Product Mix2005 Gross Premiums Written Medical Malpractice GPW

Medical Malpractice Premium: $74.0 million

Selected Classes Yearof Business Started

Hospital Professional Liability 2003

Physicians and Physician Groups 2003

Miscellaneous Medical Facilities 2004

Psychiatrists 2004

($ in millions)

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E&O 36%

D&O 20%

Medical Malpractice

44%

Demonstrated Expertise in Health Care Industry

Focus on health care encompasses all business lines

2005 Gross Premiums Written Health Care GPW($ in millions)

15

E&O 36%

D&O 20%

Medical Malpractice

44%

2003 2004 2005

$8.2

$61.3

$107.2

Select Distribution Network

Focused DistributionFocused Distribution

• 140 carefully selected distribution partners

• Significant benefits over the “open brokerage” model

• Two program administrators provide access to select markets

Key CharacteristicsKey Characteristics

• Technical expertise

• Shared commitment to excellent service

• Ability of Darwin to capture a meaningful portion of distributors’business

Fewer Producers / Greater ProductionFewer Producers / Greater Production

4% Point Improvement

Hit Rate

6%

Hit Rate

10%

Premium /Producer

Risks Bound

91% Growth

761

Risks Bound

1,454

$437

171% GrowthPremium /Producer

$1,184

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Note: $ in thousands

230 Producers

140 Producers

2004 2005

• Service differentiation with key producers

• Drives cost advantages

• Difficult-to-serve markets become profitable

• Promotes real-time underwriting / pricing refinements

• Enhances tactical flexibility

• Everything has been created in the past three years

• Senior management is committed to technology-based corporate strategy

• Technology permeates every aspect of our business

• Single operating platform

• Seamless interactivity between claims, underwriting, actuarial and finance

• (i-bind)sm extends Darwin’s operating systems to its producers

Why Our Technology is SuperiorWhy Our Technology is SuperiorBenefits of Superior TechnologyBenefits of Superior Technology

Technology drives competitive advantage

Growth TechnologyExpense Control ProfitabilityDrives

Drives Drives

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Executing the Vision

Effective Effective DistributionDistribution

Strong Capital Strong Capital Base to Support Base to Support

GrowthGrowth

Expanded Classes Expanded Classes of Businessof Business

Profitable Profitable Underwriting Underwriting OpportunitiesOpportunities

.5:1

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140

1%

Underwriting

Leverage

Select

Distribution

Partners

New Classes

of Business

Added Since

2003

Darwin

Market

Share of

$20B Market

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Jack Sennott

Senior Vice President and Chief Financial Officer

Pro Forma Capitalization

($ in millions)

20

6/30/06

Debt –

Preferred Stock –

Common Equity $203.1

Total Capitalization $203.1

Shares Outstanding (000s) 17,042.6

Book Value per Common Share $11.92

Debt / Capitalization 0.0%

GAAP Financial Results

First Half 2004 2005 ∆ 2005 2006 ∆

Gross Premiums Written

$100,455 $165,824 65.1% $70,520 $117,948 67.3%

Net Premiums Written

$70,500 $100,650 42.8% $41,359 $73,208 77.0%

Net Operating Income(1)

$47 $3,821 NM $1,748 $8,972 413.3%

GAAP Underwriting Ratios:

Loss Ratio 64.3% 69.2% 69.4% 69.2%

Expense Ratio 35.6% 28.1% 28.4% 27.2%

Combined Ratio 99.9% 97.3% 97.8% 96.4%

(1) Excludes realized gains and losses.

($ in thousands)

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Underwriting Results of Darwin’s Business Strategy

Note: 2003 reflects the period March 3, 2003 to December 31, 2003.

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Expense Ratio Loss Ratio GPW

Overview of Loss ReservesBy Statutory Line of Business By Category

Darwin’s loss reserves are predominantly IBNR

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Note: Darwin does write a small amount of occurrence business which is statistically insignificant.

Medicalliability,

claims-made

Other liability,claims-made

39.9%60.1%

ULAE: 3.5%

$6.8 Million Case: 11.2%

$21.9 Million

IBNR: 85.4%

$167.3 Million

Conservative Investment Portfolio6/30/06 Investment Portfolio Fixed Maturity Ratings and Breakdown

Current Tax-Equivalent Yield: 5.36%Average Duration: 3.72 Years

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Market Value: $334.9 Million

Short-term Investments

23.6%

Fixed Maturities

76.4%

A+, A, A-19.2%

AA+, AA, AA-13.7%

BBB+, BB0.9%

AAA66.1%

2005 – 2008 NPW Growth

Potential (CAGR)

ImpliedUnderwriting Leverage at 12/31/08 (3)

0.5x

0.7x

0.9x

Next Steps

(1) Underwriting leverage defined as NPW / equity. Comparable data from SNL Financials.(2) Simple average excluding Darwin.(3) Underwriting leverage defined as 2008E NPW/ 2008E equity. 2008E NPW based on potential 3-year CAGR.

2008E equity based on an assumed growth per annum of 9% for purposes of this page.

Growth Potential of DarwinGrowth Potential of Darwin

Our capital base will support strong premium growth

Underwriting Leverage Underwriting Leverage (1)(1) of of Comparable SmallComparable Small--cap Specialty Companiescap Specialty Companies

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NATL TWGP JRVR ACAP DR

0.5x0.6x

0.8x

1.5x1.5x

Avg. 1.1x (2)

0.0x

0.5x

1.0x

1.5x

2.0x

10%

20%

30%

ROE Target for Current Capital Base

Underwriting Underwriting Leverage Leverage (1)(1)

Investment Investment Leverage Leverage (1)(1)

90% Combined Ratio 90% Combined Ratio (Target for Medium Term)(Target for Medium Term)

Targets Targets Based onBased on

Peer Group Peer Group

Darwin Darwin 0.5x

1.0x

1.6x

2.0x–

IllustrativeIllustrativeROE ROE

–

Note: Peer group includes ACAP, TWGP, NATL and JRVR. Based on financial data at and for the period ended 12/31/05.(1) Underwriting leverage defined as NPW / equity. Investment leverage defined as invested assets / equity.(2) Based on current tax-equivalent yield of 4.97%.

8.5%

3.2%

1.3%(2)

13.0%

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Key Financial Considerations

• Pricing set in a hard market

• Expansion of premium base within current product classes

– Additional growth opportunities through “loose bricks”

– Fully deploy current capital base

• Target 90% combined ratio

– Conservative reserving philosophy – target 60% loss ratio

– Declining expense ratio as we add business

– Realization of investment in technology platform, including (i-bind)sm underwriting system

• Investment income from increased asset base

– Extending investment horizon as reserves build

– Positioned to benefit from rising rates

• Target medium-term ROE of 13%

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Building Blocks for Success

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