A.M. Best Comments on Ratings of Allied World Assurance Company Holdings, Ltd. and Its Subsidiaries

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OLDWICK, N.J. – (Business Wire) A.M. Best Co. has commented that the ratings of Allied World Assurance Company Holdings, Ltd (Allied World) (Bermuda) [NYSE: AWH] and its subsidiaries remain unchanged following the recent announcement that the company has entered into a definitive agreement to acquire Darwin Professional Underwriters, Inc. (Darwin) (Wilmington, DE) [NYSE: DR].

The transaction is expected to close in fourth quarter 2008, subject to regulatory approval. Allied World plans on financing the deal, valued at $550 million, through a combination of excess capital and a new security issuance. Absent the security issuance, Allied World has sufficient capital to fund the entire transaction.

The acquisition of Darwin accelerates Allied World’s expansion of its U.S. insurance platform. The transaction provides Allied World with profitable books of business in both healthcare and professional liability. Furthermore, Darwin’s book of business will allow Allied World greater access to small and mid-size accounts.

Partially offsetting the positive attributes of the acquisition is the execution and integration risk associated with the transaction. In addition, the general casualty market has been experiencing softening market conditions, and downward pricing pressures have been prevalent.

For current Best’s Ratings, independent data and analysis on more than 330 reinsurance companies, please visit www.ambest.com/reinsurance.

Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit http://www.ambest.com/.

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