HCC REPORTS CONTINUED SUCCESS
WITH STRONG SECOND QUARTER RESULTS

HOUSTON (August 07, 2003) . . .
HCC Insurance Holdings, Inc. (NYSE symbol: HCC), today released earnings for the second quarter of 2003.

Net earnings increased 29 percent for the second quarter of 2003 to $34.7 million from $26.8 million and diluted earnings per share grew 26% to $0.54 from $0.43, both compared to the same period in 2002.

Net earnings increased 30 percent for the first six months of 2003 to $64.9 million from $50.1 and diluted earnings per share grew 28 percent to $1.02 from $0.80, both compared to the first six months of 2002. The increase in net earnings is primarily as a result of the continuing improvement in market conditions across all of our operations, including acquisitions made in 2002.

Stephen L. Way, Chairman and Chief Executive Officer, said, “This earnings growth is at the high end of the previously announced range of 20 to 30 percent and, barring any major catastrophe, we anticipate achieving a similar result for the full year 2003.”

Total revenue grew substantially during the second quarter of 2003 rising 55 percent to $241.3 million from $155.9 million and rising 47 percent for the first six months of 2003 to $452.0 million from $307.6 million, both compared to the corresponding periods in 2002. Revenue continues to increase strongly across all of our segments and is expected to continue for the rest of this year and into 2004.

Net written premium of our insurance company subsidiaries grew significantly by 72 percent to $443.6 million during the first six months of 2003 compared to $257.7 million in the first half of 2002. During the same period, net earned premium increased by 53 percent to $345.9 million from $226.1 million. These record levels were achieved as a result of higher rates and strong growth in new business including production from underwriting agencies that we acquired in 2002. Continued growth is expected through 2004.

The GAAP combined ratio was 88.9 percent for the first six months of 2003 compared to 85.9 percent in the corresponding period of 2002. Mr. Way added, “This continuing strong underwriting performance was achieved while keeping our loss reserves at very conservative levels and despite some deterioration in our discontinued lines.”

Management fees increased 27 percent during the first six months of 2003 to $49.5 million, from $39.0 million in the first half of 2002. During the same period, commission income growth accelerated, rising 34 percent to $28.4 million. These increased revenues came from new business and the effect of acquisitions made in 2002. We anticipate continued growth in both segments through the rest of this year.

Net investment income increased by 27 percent in the first half of 2003 to $22.9 million, compared to $18.0 million in the corresponding period in 2002. This growth was due to increased investment assets, which grew 23 percent to $266.1 million during the first six months of 2003 as a result of cash flow from operations, which more than offset low investment yields. We anticipate this growth continuing through 2004.

As of June 30, 2003, total investments increased to $1.43 billion, total assets were over $4.3 billion, book value per share increased to $15.21 and the Company’s debt to total capital ratio was 24.5 percent. See attached tables.

HCC will hold an open conference call beginning at 4:00 p.m. Central Time on Thursday, August 7th to discuss these results. To participate, the number for domestic calls is (800) 482-2225 and the number for international calls is (303) 224-6997. In addition, there will be a live webcast available on a listen-only basis, that can be accessed through the HCC website at www.hcch.com. A replay of the webcast will be available on the website until Friday, August 15, 2003.

HCC is an international insurance holding company and a leading specialty insurance group since 1974. HCC is rated AA (Very Strong) by Standard & Poor’s and A+ (Superior) by A. M. Best Company.

For more information, visit our website at www.hcch.com.

©2005 HCC Insurance Holdings, Inc.