A.M. Best Places Ratings of Max Capital Group Ltd. and Its Subsidiaries Under Review With Positive Implications Due to Merger

A.M. Best Co. has placed the financial strength rating (FSR) of A- (Excellent) and issuer credit ratings (ICR) of “a-” of the operating subsidiaries of Max Capital Group Ltd. (Max) [NASDAQ: MXGL] under review with positive implications following the recent announcement of its intent to merge with Harbor Point Limited.

These rating actions apply to Max’s lead operating company, Max Bermuda Ltd, its affiliated operating subsidiaries, the ICR of “bbb-” and all debt ratings of Max. All the above named companies are domiciled in Hamilton, Bermuda. (See below for a detailed list of the companies and ratings.)

The under review status reflects the potential benefits to Max in terms of broadening its management depth, adding strong underwriting teams, improved diversification, increased capacity and greater scale of operations. At a high level, the new company, which is to be named Alterra Capital Holdings Limited, will have little overlap in terms of lines of business, which makes this a complementary transaction. It is anticipated that the risk-adjusted capital of the combined organization will be strong after considering the proposed post closing extraordinary dividend of approximately $300 million.

The transaction itself is stock for stock and is not contingent upon raising public or private capital. The deal is not expected to close until sometime in second quarter 2010, subject to shareholder and regulatory approvals. The ratings will remain under review until the transaction has closed and A.M. Best has completed its evaluation of the merged entity.

The FSR of A- (Excellent) and ICRs of “a-” have been placed under review with positive implications for the following operating subsidiaries of Max Capital Group Ltd.:

• Max Bermuda Ltd.
• Max Re Europe Limited
• Max Insurance Europe Limited
• Max America Insurance Company
• Max Specialty Insurance Company

The ICR of “bbb-” has been placed under review with positive implications for Max Capital Group Ltd.

The following debt rating has been placed under review with positive implications:

Max USA Holdings Ltd. (guaranteed by Max Capital Group Ltd.)—

--“bbb-” on $100 million 7.2% senior secured notes, due 2017

The following indicative ratings under the current shelf registration have been placed under review with positive implications:

Max Capital Group Ltd.—

-- “bbb-” on senior unsecured debt

-- “bb+” on subordinated debt

-- “bb” preferred stock

Max USA Holdings Ltd. (guaranteed by Max Capital Group Ltd.)—

--“bbb-” on senior secured debt

-- “bb+” on subordinated debt

Max Capital Trust I (guaranteed by Max Capital Group Ltd.)—

-- “bb” on preferred securities

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.