A.M. Best Downgrades Ratings of IPC Holdings Ltd. and Its Subsidiaries

A.M. Best Co. has downgraded the financial strength ratings to A- (Excellent) from A (Excellent) and issuer credit ratings to �a-� from �a� of IPCRe Limited (Bermuda) and IPCRe Europe Limited (Dublin, Ireland), which are reinsurance subsidiaries of IPC Holdings Ltd. (IPC) (Bermuda) (NASDAQ: IPCR). The ratings continue to be under review with negative implications following the recent announcement of the definitive agreement between IPC and Validus Holdings, Ltd (NYSE: VR). A.M. Best also has downgraded IPC�s ICR to �bbb-� from �bbb� and the indicative ratings for securities available under shelf registration to �bb� from �bb+� on preferred stock, �bbb-� from �bbb� on senior unsecured debt and to �bb+� from �bbb-� on subordinated debt of IPC. These ratings remain under review with negative implications.

The ratings of IPC were initially assigned a negative outlook in December 2007 based on concerns regarding the company�s enterprise risk management and its impact on capital optimization, which could drive stronger, sustainable long-term results. In order to seek out capital optimization, the IPC Board of Directors and its management had been pursuing a merger or acquisition strategy. However, the business profile of IPC has deteriorated over the last several months, during which time IPC has been party to a failed transaction and the target of a hostile take over. If for any reason the current transaction is not completed, in A.M. Best�s opinion, as a stand-alone entity, IPC�s business profile is now commensurate with that of an A- (Excellent) rated organization.

The under review status reflects the execution risk associated with the current pending transaction; therefore, the ratings will remain under review until the transaction closes and there is a clearer indication of the future status of IPC�s organizational structure.

For Best�s Credit Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.

The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology.

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 www.ambest.com.

Ipc Holdings, Limited - Common Shares (MM) (NASDAQ:IPCR)
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