SHARE-BASED COMPENSATION

6 Months Ended

Jun. 30, 2012

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

SHARE-BASED COMPENSATION [Text Block]

7.     SHARE-BASED COMPENSATION

In May 2012, our shareholders approved an amendment to the AXIS Capital Holdings Limited 2007 Long-Term Equity Compensation Plan (the "2007 Plan"), increasing the number of common shares authorized for issuance by 6 million. At June 30,2012, 6,454,519 equity based awards remain available for grant under the 2007 plan.

Restricted Stock

During 2012, the Company granted a performance-based stock award to a key employee in order to promote long-term growth and profitability. The award represents the right to receive a specified number of common shares in the future, based upon the achievement of established performance criteria during the applicable performance period, which is the third anniversary of the grant date. At June 30,2012, we anticipate that the established performance criterion for this award is likely to be achieved.

The following table provides a reconciliation of the beginning and ending balance of nonvested restricted stock (including restricted stock units) for the six months endedJune 30,2012:

	Performance-based Stock Awards			Service-based Stock Awards
	Number of Restricted Stock	Weighted Average Grant Date Fair Value		Number of Restricted Stock		Weighted Average Grant Date Fair Value
Nonvested restricted stock - beginning of period	—	$	—	3,816		$	32.69
Granted	250	34.42		2,167		31.91
Vested	—	—		(1,232	)	31.96
Forfeited	—	—		(73	)	32.12
Nonvested restricted stock - end of period	250	$	34.42	4,678		$	32.58

For the three months endedJune 30,2012, we incurred share-based compensation costs of $33 million (2011: $10 million) and recorded tax benefits thereon of $3 million (2011: $2 million). For the six months endedJune 30,2012, we incurred share-based compensation costs of $45 million (2011: $20 million) and recorded tax benefits thereon of $5 million (2011: $4 million). The fair value of shares vested during the six months endedJune 30,2012 was $40 million (2011: $63 million). At June 30,2012 there were $116 million of unrecognized share-based compensation costs, which are expected to be recognized over the weighted average period of 2.9 years.

During the second quarter of 2012, the transition in our senior leadership resulted in accelerated and incremental share-based compensation expenses totaling $20 million.  The retirement of one senior leader resulted in the modification of that leader's outstanding restricted stock awards to eliminate the previously existing service condition.  The unanticipated termination without cause of another senior officer led to the early satisfaction of employment obligations and resulted in the service condition associated with that officer's outstanding restricted stock awards being fully satisfied.