Validus Holdings, Ltd.
	Investor Financial Supplement – Fourth Quarter 2016
	February 2, 2017
	29 Richmond Road
	Pembroke, HM 08 Bermuda
	Telephone: (441) 278-9000
	Facsimile: (441) 278-9090
	Website: www.validusholdings.com
	Mailing address: Suite 1790 48 Par-la-Ville Road
	Hamilton, HM 11 Bermuda

Validus Holdings, Ltd.
Table of Contents
Section	Page
Table of Contents	2
Explanatory Notes	3
Consolidated Financial Highlights	4
Summary Consolidated Balance Sheets	5
Computation of Book Value per Common Share, Book Value per Diluted Common Share and Tangible Book Value per Common Share	6
Consolidated Statements of Cash Flows	7
Consolidated Statements Income and Comprehensive Income	8
Consolidated Statements of Operations - Underwriting Income Format	9
Computation of Earnings per Share	10
Computation of Weighted Average Dilutive Common Shares Outstanding	11
Underwriting Income Statement - Validus Re	12
Underwriting Results by Class of Business - Three months ended - Validus Re	13
Underwriting Results by Class of Business - Year ended - Validus Re	14
Underwriting Income Statement - Talbot	15
Underwriting Results by Class of Business - Three months ended - Talbot	16
Underwriting Results by Class of Business - Year ended - Talbot	17
Underwriting Income Statement - Western World	18
Underwriting Results by Class of Business - Three months ended - Western World	19
Underwriting Results by Class of Business - Year ended - Western World	20
AlphaCat Managers Segment Information	21
AlphaCat Assets Under Management	22
Corporate and Investments	23
Segment Reconciliation - Three months ended	24
Segment Reconciliation - Year ended	25
Non-GAAP Financial Measure Reconciliation	26
Consolidated Class of Business Policy Type Detail - Gross Premiums Written	27
Gross Premiums Written by Segment by Class of Business	28
Consolidated Analysis of Reserves for Losses and Loss Expenses	29
Consolidated Losses and Loss Ratios by Segment	30
Losses and Loss Ratios by Class of Business - Validus Re	31
Losses and Loss Ratios by Class of Business - Talbot	32
Losses and Loss Ratios by Class of Business - Western World	33
Analysis of Loss Ratios by Segment	34
Consolidated Reinsurance Recoverable Analysis	35
Consolidated Investment Portfolio Composition and Net Investment Income	36
Consolidated Fixed Maturity Portfolio Credit Quality and Maturity Profile	37
Top Ten Exposures to Fixed Income Corporate Issuers	38
Capitalization	39
Estimated Exposures to Peak Zone Property Catastrophe Losses - As of January 1, 2017	40
Estimated Exposures to Specified Loss Scenarios - As of July 1, 2016	41

2 of 41

Validus Holdings, Ltd.

Explanatory Notes

Basis of Presentation

• All financial information contained herein is unaudited however, certain information relating to the years ended December 31, 2015 and 2014 is derived from or agrees to audited financial information. Unless otherwise noted, dollar amounts are in thousands of U.S. dollars, except for share and per share amounts and ratio information. Certain amounts in prior periods have been reclassified to conform to current period presentation.

• During the fourth quarter of 2015, the Company early adopted Accounting Standards Update 2015-02, “Consolidation (Topic 810): Amendments to the Consolidation Analysis” issued by the United States Financial Accounting Standards Board (“FASB”). The adoption of this amended accounting guidance has been implemented utilizing a full retrospective application for all periods presented in the Company's Consolidated Financial Statements. The impact on the Company's cumulative retained earnings was a gain of $405.

• During the fourth quarter of 2015, certain presentation changes were made to the basis of reporting. The changes were made to present the results of the Validus Re, Talbot and Western World segments on an underwriting income basis. Other insurance related income is included within underwriting income. The results of AlphaCat are presented on an asset manager basis, consistent with the operating structure. Investment results, foreign exchange gains (losses), finance expenses, dividends on preferred shares, other income (loss), and income taxes are presented on a consolidated group basis. Prior period comparatives have been restated to reflect the change in presentation.

Financial Measures

In presenting our results, we include certain financial measures which are important for an understanding of our overall results of operations. We believe that these measures are important to investors and other interested parties, and that such persons benefit from having a consistent basis for comparison with other companies within the industry. However, these measures may not be comparable to similarly titled measures used by companies either inside or outside of the insurance industry.

• In the basic earnings per share calculation, dividends on preferred shares and outstanding warrants are deducted from net income. In calculating earnings per diluted share, we consider the application of the treasury stock method and the two-class method and which ever is more dilutive is included into the calculation of earnings per diluted share.

• Net operating income (loss), a non-GAAP financial measure, is defined as net income (loss) excluding net realized and change in net unrealized gains (losses) on investments, income (loss) from investment affiliates, foreign exchange gains (losses), other income (loss) and non-recurring items. This measure focuses on the underlying fundamentals of our operations without the influence of gains (losses) from the sale of investments, translation of non-U.S.$ currencies and non-recurring items. Gains (losses) from the sale of investments are driven by the timing of the disposition of investments, not by our operating performance. Gains (losses) arising from translation of non-U.S.$ denominated balances are unrelated to our underlying business. Net operating income (loss) available (attributable) to Validus common shareholders is defined as above, but excludes operating income (loss) available (attributable) to noncontrolling interest and dividends on preferred shares. Refer to the Non-GAAP Financial Measure Reconciliation on page 26.

• Underwriting income is a measure of profitability that takes into account net premiums earned and other insurance related income as revenue and net loss and loss expenses, acquisition costs and underwriting related general and administrative expenses as expenses. Underwriting income is the difference between revenues and expense items. A reconciliation of underwriting income to net income available to Validus common shareholders, the most comparable U.S. GAAP financial measure is presented in the 'Consolidated Statement of Operations - Underwriting Income Format' contained herein.

• Annualized investment yield is calculated by dividing net investment income by the average balance of the yield bearing assets managed by our portfolio managers (including funds of high grade structured products which are included in other investments, but excluding all other investments). Average assets for the three months ended is the average of the beginning and ending quarter end asset balances. Average assets for the year ended is the average of the beginning, ending and intervening quarter end asset balances. Percentages for the quarter periods are annualized.

• Annualized return on average equity represents the level of net income available to Validus common shareholders generated from average shareholders’ equity during the period. Average shareholders' equity for the three months ended is the average of the beginning and ending quarter end shareholders' equity balances, excluding the liquidation value of the preferred shares of $150 million. Average shareholders’ equity for the year ended is the average of the beginning, ending and intervening quarter end shareholders’ equity balances, excluding the liquidation value of the preferred shares of $150 million. Percentages for the quarter periods are annualized.

• Annualized net operating return on average equity is calculated by dividing the net operating income available to Validus common shareholders for the period by the average shareholders’ equity during the period. Average shareholders' equity for the three months ended is the average of the beginning and ending quarter end shareholders' equity balances, excluding the liquidation value of the preferred shares of $150 million. Average shareholders’ equity for the year ended is the average of the beginning, ending and intervening quarter end common shareholders’ equity balances, excluding the liquidation value of the preferred shares of $150 million. Percentages for the quarter periods are annualized. A reconciliation of net operating income available to Validus common shareholders to net income available to Validus common shareholders is included on page 26.

3 of 41

Validus Holdings, Ltd.

Consolidated Financial Highlights

(Expressed in thousands of U.S. Dollars, except share and per share information

		Three Months Ended															Years Ended
		December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Highlights	Net income available to Validus common shareholders	$	7,767		$	89,844		$	94,963		$	166,810		$	69,042		$	359,384		$	374,893
	Net operating income available to Validus common shareholders (a)	64,323			82,597			54,900			117,378			105,395			319,198			409,749
	Gross premiums written	339,454			372,418			764,042			1,172,791			309,605			2,648,705			2,557,506
	Net premiums earned	540,399			563,775			573,723			571,268			543,300			2,249,165			2,246,889
	Total assets	11,349,755			11,486,153			11,818,244			11,204,521			10,515,812			11,349,755			10,515,812
	Total shareholders' equity available to Validus common shareholders	3,688,291			3,717,620			3,716,256			3,724,426			3,638,975			3,688,291			3,638,975
Per share data	Earnings per basic common share(b)
	Net income available to Validus common shareholders	$	0.10		$	1.12		$	1.16		$	2.01		$	0.84		$	4.43		$	4.47
	Net operating income available to Validus common shareholders	0.81			1.03			0.67			1.42			1.28			3.94			4.89
	Earnings per diluted common share (b)
	Net income available to Validus common shareholders	$	0.10		$	1.11		$	1.14		$	1.98		$	0.81		$	4.36		$	4.34
	Net operating income available to Validus common shareholders	0.80			1.02			0.66			1.39			1.24			3.88			4.74
	Book value per common share	$	46.61		$	46.80		$	46.01		$	45.67		$	43.90		$	46.61		$	43.90
	Book value per diluted common share	$	44.97		$	45.16		$	44.41		$	44.00		$	42.33		$	44.97		$	42.33
	Growth in book value per diluted common share inclusive of dividends	0.4%			2.5%			1.7%			4.8%			1.8%			9.5%			10.0		%
	Book value per diluted common share plus accumulated dividends	$	56.53		$	56.37		$	55.27		$	54.51		$	52.49		$	56.53		$	52.49
Financial ratios	Losses and loss expense ratio	50.9		%	45.8		%	53.5		%	39.3		%	39.5		%	47.4		%	43.5		%
	Policy acquisition costs ratio	22.4		%	20.1		%	18.8		%	18.8		%	18.8		%	20.0		%	18.3		%
	General and administration expenses ratio	16.3		%	16.5		%	17.6		%	17.0		%	20.0		%	16.8		%	17.9		%
	Expense ratio	38.7		%	36.6		%	36.4		%	35.8		%	38.8		%	36.8		%	36.2		%
	Combined ratio	89.6		%	82.4		%	89.9		%	75.1		%	78.3		%	84.2		%	79.7		%
	Annualized return on average equity (c)	0.8		%	9.7		%	10.2		%	18.1		%	7.6		%	9.7		%	10.3		%
	Annualized net operating return on average equity (d)	6.9		%	8.9		%	5.9		%	12.8		%	11.6		%	8.6		%	11.3		%

Notes:

(a) Net operating income is considered a non-GAAP financial measure. Refer to the Explanatory Notes on page 3 and the Non-GAAP Financial Measure Reconciliation on page 26 for further information.

(b) In the basic earnings per share calculation, dividends on preferred shares and outstanding warrants are deducted from net income. In calculating earnings per diluted share, we consider the application of the treasury stock method and the two-class method and which ever is more dilutive is included into the calculation of earnings per diluted share.

(c) Annualized net return on average equity represents the level of net income available to Validus common shareholders generated from average shareholders’ equity during the period. Average shareholders' equity for the three months ended is the average of the beginning and ending quarter end shareholders' equity balances, excluding the liquidation value of the preferred shares of $150 million. Average shareholders’ equity for the year ended is the average of the beginning, ending and intervening quarter end shareholders’ equity balances, excluding the liquidation value of the preferred shares of $150 million. Percentages for the quarter periods are annualized.

(d) Annualized net operating return on average equity is calculated by dividing the net operating income available to Validus common shareholders for the period by the average shareholders’ equity during the period. Average shareholders' equity for the three months ended is the average of the beginning and ending quarter end shareholders' equity balances, excluding the liquidation value of the preferred shares of $150 million. Average shareholders’ equity for the year ended is the average of the beginning, ending and intervening quarter end common shareholders’ equity balances, excluding the liquidation value of the preferred shares of $150 million. Percentages for the quarter periods are annualized. A reconciliation of net operating income available to Validus common shareholders to net income available to Validus common shareholders is included on page 26.

4 of 41

Validus Holdings, Ltd.

Summary Consolidated Balance Sheets

(Expressed in thousands of U.S. Dollars, except share and per share information)

	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			September 30, 2015			June 30, 2015			March 31, 2015			December 31, 2014
Assets
Fixed maturities trading, at fair value	$	5,543,030		$	5,576,341		$	5,551,586		$	5,481,304		$	5,510,331		$	5,596,403		$	5,471,804		$	5,496,979		$	5,545,231
Short-term investments trading, at fair value	2,796,170			2,481,406			2,369,654			2,108,199			1,941,635			1,731,443			1,600,207			1,384,464			1,501,212
Other investments, at fair value	405,712			394,695			359,526			344,151			336,856			334,667			331,458			339,692			334,685
Investments in investment affiliates, equity method	100,431			99,731			99,278			84,135			87,673			88,134			89,681			85,982			63,506
Cash and cash equivalents	419,976			443,992			568,798			569,774			723,109			412,474			439,092			474,349			550,401
Restricted cash	70,956			113,048			96,022			108,395			73,270			74,002			140,019			186,423			173,003
Total investments and cash	9,336,275			9,109,213			9,044,864			8,695,958			8,672,874			8,237,123			8,072,261			7,967,889			8,168,038
Investments in operating affiliate, equity method	—			—			—			369			392			48,703			56,666			54,928			50,944
Premiums receivable	725,390			939,127			1,372,000			1,176,684			658,682			1,060,923			1,273,387			1,113,579			706,467
Deferred acquisition costs	209,227			249,922			283,213			262,675			181,002			224,982			253,042			240,695			161,022
Prepaid reinsurance premiums	77,996			119,805			145,567			181,255			77,992			126,278			162,251			193,166			82,947
Securities lending collateral	9,779			10,629			10,224			9,721			4,863			6,461			7,021			5,337			470
Loss reserves recoverable	430,421			444,609			442,987			370,689			350,586			385,212			376,665			375,882			377,466
Paid losses recoverable	35,247			36,069			27,648			25,001			23,071			21,681			40,198			27,034			38,078
Income taxes recoverable	4,870			6,879			8,526			7,146			16,228			15,870			13,787			10,597			—
Deferred tax asset	43,529			26,015			23,745			27,771			21,661			22,352			23,079			30,847			23,821
Receivable for investments sold	3,901			21,854			13,736			16,278			39,766			15,055			29,131			24,803			18,318
Intangible assets	115,592			117,010			118,426			119,842			121,258			122,676			124,092			125,508			126,924
Goodwill	196,758			196,758			196,758			196,758			196,758			196,758			196,758			195,897			195,897
Accrued investment income	26,488			24,906			24,925			22,298			23,897			23,755			23,894			23,230			24,865
Other assets	134,282			183,357			105,625			92,076			126,782			93,181			105,182			125,130			137,307
Total assets	$	11,349,755		$	11,486,153		$	11,818,244		$	11,204,521		$	10,515,812		$	10,601,010		$	10,757,414		$	10,514,522		$	10,112,564
Liabilities
Reserve for losses and loss expenses	$	2,995,195		$	3,035,987		$	3,122,717		$	2,980,300		$	2,996,567		$	3,172,285		$	3,192,663		$	3,207,885		$	3,243,147
Unearned premiums	1,076,049			1,359,438			1,621,563			1,503,161			966,210			1,281,319			1,518,603			1,451,457			989,229
Reinsurance balances payable	54,781			76,429			92,488			96,685			75,380			89,954			94,795			102,852			129,071
Securities lending payable	10,245			11,095			10,690			10,187			5,329			6,927			7,487			5,803			936
Deferred tax liability	3,331			3,278			3,552			3,618			3,847			8,921			8,063			13,265			5,541
Payable for investments purchased	29,447			49,435			52,718			76,116			77,475			118,164			105,871			123,556			68,574
Accounts payable and accrued expenses	587,648			144,086			149,593			136,712			627,331			159,440			200,469			159,169			395,178
Notes payable to AlphaCat investors	278,202			372,730			370,982			323,510			75,493			75,607			—			—			—
Senior notes payable	245,362			245,311			245,261			245,211			245,161			245,111			245,061			245,010			244,960
Debentures payable	537,226			538,168			537,987			538,335			537,668			538,054			538,032			537,561			539,277
Total liabilities	5,817,486			5,835,957			6,207,551			5,913,835			5,610,461			5,695,782			5,911,044			5,846,558			5,615,913
Redeemable noncontrolling interest	1,528,001			1,559,580			1,532,283			1,409,037			1,111,714			1,101,147			1,035,511			834,644			617,791
Shareholders' equity
Preferred shares	$	150,000		$	150,000		$	150,000		$	—		$	—		$	—		$	—		$	—		$	—
Common shares	28,224			28,223			28,219			28,102			28,100			27,726			27,716			27,431			27,222
Treasury shares	(14,376		)	(14,320		)	(14,084		)	(13,830		)	(13,592		)	(13,376		)	(13,140		)	(12,795		)	(12,545		)
Additional paid-in capital	821,023			827,256			883,701			954,485			1,002,980			1,048,917			1,097,527			1,162,485			1,207,493
Accumulated other comprehensive (loss)	(23,216		)	(21,092		)	(18,182		)	(15,438		)	(12,569		)	(10,869		)	(9,066		)	(12,641		)	(8,556		)
Retained earnings	2,876,636			2,897,553			2,836,602			2,771,107			2,634,056			2,592,567			2,554,299			2,517,257			2,372,972
Total shareholders' equity available to Validus	3,838,291			3,867,620			3,866,256			3,724,426			3,638,975			3,644,965			3,657,336			3,681,737			3,586,586
Noncontrolling interest	165,977			222,996			212,154			157,223			154,662			159,116			153,523			151,583			292,274
Total shareholders' equity	4,004,268			4,090,616			4,078,410			3,881,649			3,793,637			3,804,081			3,810,859			3,833,320			3,878,860
Total liabilities, noncontrolling interests and shareholders' equity	$	11,349,755		$	11,486,153		$	11,818,244		$	11,204,521		$	10,515,812		$	10,601,010		$	10,757,414		$	10,514,522		$	10,112,564
Book value per common share	$	46.61		$	46.80		$	46.01		$	45.67		$	43.90		$	44.45		$	43.91		$	44.02		$	42.76
Book value per diluted common share	$	44.97		$	45.16		$	44.41		$	44.00		$	42.33		$	41.89		$	41.44		$	41.26		$	39.65
Book value per diluted common share plus accumulated dividends	$	56.53		$	56.37		$	55.27		$	54.51		$	52.49		$	51.73		$	50.96		$	50.46		$	48.53

5 of 41

Validus Holdings, Ltd.

Computation of Book Value per Common Share, Book Value per Diluted Common Share and Tangible Book Value per Common Share

(Expressed in thousands of U.S. Dollars, except share and per share information)

	At December 31, 2016							At December 31, 2015
	Equity Amount		Shares	Exercise Price (a)		Book Value Per Share		Equity Amount		Shares	Exercise Price (a)		Book Value Per Share
Book value per common share
Total shareholders' equity available to Validus common shareholders (b)	$	3,688,291	79,132,252			$	46.61	$	3,638,975	82,900,617			$	43.90
Tangible book value per common share						$	42.66						$	40.06
Book value per diluted common share
Total shareholders' equity available to Validus common shareholders (b)	$	3,688,291	79,132,252					$	3,638,975	82,900,617
Assumed exercise of outstanding stock options (c)	614		26,136	$	23.48			1,319		65,401	$	20.17
Unvested restricted shares	—		2,868,610					—		3,026,376
Book value per diluted common share	$	3,688,905	82,026,998			$	44.97	$	3,640,294	85,992,394			$	42.33
Adjustment for accumulated dividends						11.56							10.16
Book value per diluted common share plus accumulated dividends						$	56.53						$	52.49
Tangible book value per diluted common share						$	41.16						$	38.63

Notes:

(a) Weighted average exercise price for those stock options that have an exercise price lower than book value per share.

(b) Total shareholders' equity available to Validus common shareholders excludes the liquidation value of the preferred shares of $150 million.

(c) Using the "as-if-converted" method, assuming all proceeds received upon exercise of stock options will be retained by the Company and the resulting common shares from exercise remain outstanding.

6 of 41

Validus Holdings, Ltd.

Consolidated Statements of Cash Flows

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended															Years Ended
	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Cash flows provided by (used in) operating activities
Net Income	$	37,170		$	129,535		$	116,156		$	204,341		$	95,038		$	487,202		$	467,857
Adjustments to reconcile net income to cash provided by (used in) operating activities:
Share compensation expenses	10,442			10,501			10,727			11,237			10,062			42,907			38,341
Amortization of discount on senior notes	27			27			27			27			27			108			108
(Loss) income from investment and operating affiliates	(2,166		)	(453		)	589			4,136			2,969			2,106			(332		)
Net realized and change in net unrealized losses (gains) on investments	58,240			(9,856		)	(34,152		)	(46,860		)	37,790			(32,628		)	30,097
Amortization of intangible assets	1,418			1,416			1,416			1,416			1,418			5,666			5,666
Foreign exchange losses (gains) included in net income	7,628			1,704			168			(6,457		)	2,358			3,043			18,907
Amortization of premium on fixed maturities	4,580			4,671			4,172			4,538			5,209			17,961			23,075
Change in operational balance sheet items, net	38,268			47,608			4,386			(206,424		)	32,775			(116,162		)	(249,213		)
Net cash provided by (used in) operating activities	$	155,607		$	185,153		$	103,489		$	(34,046	)	$	187,646		$	410,203		$	334,506
Cash flows provided by (used in) investing activities
Purchases of investments	$	(366,894	)	$	(182,871	)	$	(343,486	)	$	(81,468	)	$	(239,774	)	$	(974,719	)	$	(492,891	)
Decrease (increase) in securities lending collateral	850			(405		)	(503		)	(4,858		)	1,598			(4,916		)	(4,393		)
Redemption from (investment in) investment & operating affiliates, net	1,466			(2		)	(15,361		)	(575		)	45,803			(14,472		)	26,717
Decrease (increase) in restricted cash	42,092			(17,026		)	12,373			(35,125		)	732			2,314			99,733
Net cash (used in) provided by investing activities	$	(322,486	)	$	(200,304	)	$	(346,977	)	$	(122,026	)	$	(191,641	)	$	(991,793	)	$	(370,834	)
Cash flows provided by (used in) financing activities
Net proceeds on issuance of notes payable to AlphaCat investors	$	(202	)	$	1,779		$	47,348		$	247,400		$	(114	)	$	296,325		$	75,493
Net proceeds on issuance of preferred shares	—			—			144,852			—			—			144,852			—
Issuance of common shares, net	(70		)	(246		)	(7,785		)	400			672			(7,701		)	17,407
Purchases of common shares under share repurchase program	(16,660		)	(66,932		)	(68,715		)	(60,368		)	(56,513		)	(212,675		)	(260,430		)
Dividends paid on common and preferred shares	(29,927		)	(30,192		)	(31,324		)	(28,637		)	(26,566		)	(120,080		)	(112,967		)
(Decrease) increase in securities lending payable	(850		)	405			503			4,858			(1,598		)	4,916			4,393
Third party investment (redemption) in redeemable noncontrolling interest, net	11,499			(5,784		)	112,500			257,950			1,500			376,165			412,267
Third party investment (distributions) in noncontrolling interest, net	—			—			50,968			(6,397		)	(10,583		)	44,571			(159,158		)
Third party subscriptions received (deployed) in AlphaCat Funds and Sidecars	187,452			(1,400		)	700			(412,036		)	411,536			(225,284		)	249,636
Net cash provided by (used in) financing activities	$	151,242		$	(102,370	)	$	249,047		$	3,170		$	318,334		$	301,089		$	226,641
Effect of foreign currency rate changes on cash and cash equivalents	(8,379		)	(7,285		)	(6,535		)	(433		)	(3,704		)	(22,632		)	(7,285		)
Net (decrease) increase in cash and cash equivalents	(24,016		)	(124,806		)	(976		)	(153,335		)	310,635			(303,133		)	(124,806		)
Cash and cash equivalents - beginning of period	443,992			568,798			569,774			723,109			412,474			723,109			550,401
Cash and cash equivalents - end of period	$	419,976		$	443,992		$	568,798		$	569,774		$	723,109		$	419,976		$	723,109
Taxes paid during the period	$	120		$	2,077		$	1,720		$	2,117		$	1,091		$	6,034		$	16,050
Interest paid during the period	$	8,566		$	18,520		$	8,249		$	19,303		$	8,200		$	54,638		$	55,047
Losses paid during the period	$	277,422		$	345,246		$	222,657		$	269,077		$	358,561		$	1,114,402		$	1,167,839

7 of 41

Validus Holdings, Ltd.

Consolidated Statements Income and Comprehensive Income

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended															Years Ended
	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Revenues
Gross premiums written	$	339,454		$	372,418		$	764,042		$	1,172,791		$	309,605		$	2,648,705		$	2,557,506
Reinsurance premiums ceded	(40,635		)	(45,006		)	(36,229		)	(167,835		)	(33,128		)	(289,705		)	(328,681		)
Net premiums written	298,819			327,412			727,813			1,004,956			276,477			2,359,000			2,228,825
Change in unearned premiums	241,580			236,363			(154,090		)	(433,688		)	266,823			(109,835		)	18,064
Net premiums earned	540,399			563,775			573,723			571,268			543,300			2,249,165			2,246,889
Net investment income	38,153			43,514			39,257			29,461			31,612			150,385			127,824
Net realized gains (losses) on investments	9,220			4,397			2,724			(584		)	(2,928		)	15,757			2,298
Change in net unrealized (losses) gains on investments	(67,460		)	5,459			31,428			47,444			(34,862		)	16,871			(32,395		)
Income (loss) from investment affiliates	2,166			453			(589		)	(4,113		)	(1,261		)	(2,083		)	4,281
Other insurance related income and other (loss) income	568			(610		)	824			1,413			2,545			2,195			5,111
Foreign exchange (losses) gains	(901		)	(766		)	6,286			6,245			797			10,864			(8,731		)
Total revenues	522,145			616,222			653,653			651,134			539,203			2,443,154			2,345,277
Expenses
Losses and loss expenses	275,126			258,394			307,130			224,447			214,748			1,065,097			977,833
Policy acquisition costs	120,889			113,434			107,966			107,193			102,285			449,482			410,058
General and administrative expenses	77,955			82,443			89,688			86,208			98,563			336,294			363,709
Share compensation expenses	10,442			10,501			10,727			11,237			10,062			42,907			38,341
Finance expenses	14,630			14,521			14,166			15,203			16,581			58,520			74,742
Total expenses	499,042			479,293			529,677			444,288			442,239			1,952,300			1,864,683
Income before taxes, loss from operating affiliates and (income) attributable to AlphaCat investors	23,103			136,929			123,976			206,846			96,964			490,854			480,594
Tax benefit (expense)	21,147			(1,830		)	(1,706		)	2,118			756			19,729			(6,376		)
Loss from operating affiliate	—			—			—			(23		)	(1,708		)	(23		)	(3,949		)
(Income) attributable to AlphaCat investors	(7,080		)	(5,564		)	(6,114		)	(4,600		)	(974		)	(23,358		)	(2,412		)
Net income	37,170			129,535			116,156			204,341			95,038			487,202			467,857
Net (income) attributable to noncontrolling interest	(27,200		)	(37,439		)	(21,193		)	(37,531		)	(25,996		)	(123,363		)	(92,964		)
Net income available to Validus	9,970			92,096			94,963			166,810			69,042			363,839			374,893
Dividends on preferred shares	(2,203		)	(2,252		)	—			—			—			(4,455		)	—
Net income available to Validus common shareholders	7,767			89,844			94,963			166,810			69,042			359,384			374,893
Comprehensive income
Net income	$	37,170		$	129,535		$	116,156		$	204,341		$	95,038		$	487,202		$	467,857
Other comprehensive (loss) income
Change in foreign currency translation adjustments	(3,755		)	(1,370		)	(3,287		)	(2,028		)	(1,610		)	(10,440		)	(3,716		)
Change in minimum pension liability, net of tax	221			(1,101		)	479			(83		)	415			(484		)	544
Change in fair value of cash flow hedge	1,410			(439		)	64			(758		)	(505		)	277			(841		)
Other comprehensive (loss)	$	(2,124	)	$	(2,910	)	$	(2,744	)	$	(2,869	)	$	(1,700	)	$	(10,647	)	$	(4,013	)
Comprehensive (income) attributable to noncontrolling interest	(27,200		)	(37,439		)	(21,193		)	(37,531		)	(25,996		)	(123,363		)	(92,964		)
Comprehensive income available to Validus	$	7,846		$	89,186		$	92,219		$	163,941		$	67,342		$	353,192		$	370,880
Earnings per share
Weighted average number of common shares and common share equivalents outstanding
Basic	79,261,409			80,134,394			81,950,833			82,821,261			82,538,834			81,041,974			83,107,236
Diluted	80,621,967			81,244,556			83,373,003			84,198,315			85,181,258			82,359,460			86,426,760
Basic earnings per share available to Validus common shareholders	$	0.10		$	1.12		$	1.16		$	2.01		$	0.84		$	4.43		$	4.47
Earnings per diluted share available to Validus common shareholders	$	0.10		$	1.11		$	1.14		$	1.98		$	0.81		$	4.36		$	4.34
Cash dividends declared per common share	$	0.35		$	0.35		$	0.35		$	0.35		$	0.32		$	1.40		$	1.28

8 of 41

Validus Holdings, Ltd.

Consolidated Statements of Operations - Underwriting Income Format

(Expressed in thousands of U.S. Dollars, except share and per share information

	Three Months Ended															Years Ended
	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Underwriting revenues
Gross premiums written	$	339,454		$	372,418		$	764,042		$	1,172,791		$	309,605		$	2,648,705		$	2,557,506
Reinsurance premiums ceded	(40,635		)	(45,006		)	(36,229		)	(167,835		)	(33,128		)	(289,705		)	(328,681		)
Net premiums written	298,819			327,412			727,813			1,004,956			276,477			2,359,000			2,228,825
Change in unearned premiums	241,580			236,363			(154,090		)	(433,688		)	266,823			(109,835		)	18,064
Net premiums earned	540,399			563,775			573,723			571,268			543,300			2,249,165			2,246,889
Other insurance related income	561			919			745			736			969			2,961			6,113
Total underwriting revenues	540,960			564,694			574,468			572,004			544,269			2,252,126			2,253,002
Underwriting deductions
Losses and loss expenses	275,126			258,394			307,130			224,447			214,748			1,065,097			977,833
Policy acquisition costs	120,889			113,434			107,966			107,193			102,285			449,482			410,058
General and administrative expenses	77,955			82,443			89,688			86,208			98,563			336,294			363,709
Share compensation expenses	10,442			10,501			10,727			11,237			10,062			42,907			38,341
Total underwriting deductions	484,412			464,772			515,511			429,085			425,658			1,893,780			1,789,941
Underwriting income	$	56,548		$	99,922		$	58,957		$	142,919		$	118,611		$	358,346		$	463,061
Net investment income	38,153			43,514			39,257			29,461			31,612			150,385			127,824
Finance expenses	(14,630		)	(14,521		)	(14,166		)	(15,203		)	(16,581		)	(58,520		)	(74,742		)
Dividends on preferred shares	(2,203		)	(2,252		)	—			—			—			(4,455		)	—
Tax benefit (expense)	21,147			(1,830		)	(1,706		)	2,118			756			19,729			(6,376		)
Loss from operating affiliate	—			—			—			(23		)	(1,708		)	(23		)	(3,949		)
(Income) attributable to AlphaCat investors	(7,080		)	(5,564		)	(6,114		)	(4,600		)	(974		)	(23,358		)	(2,412		)
Net operating (income) attributable to noncontrolling interest	(27,612		)	(36,672		)	(21,328		)	(37,294		)	(26,321		)	(122,906		)	(93,657		)
Net operating income available to Validus common shareholders (a)	$	64,323		$	82,597		$	54,900		$	117,378		$	105,395		$	319,198		$	409,749
Net realized gains (losses) on investments	9,220			4,397			2,724			(584		)	(2,928		)	15,757			2,298
Change in net unrealized (losses) gains on investments	(67,460		)	5,459			31,428			47,444			(34,862		)	16,871			(32,395		)
Income (loss) from investment affiliates	2,166			453			(589		)	(4,113		)	(1,261		)	(2,083		)	4,281
Foreign exchange (losses) gains	(901		)	(766		)	6,286			6,245			797			10,864			(8,731		)
Other income (loss)	7			(1,529		)	79			677			1,576			(766		)	(1,002		)
Net loss (income) attributable to noncontrolling interest	412			(767		)	135			(237		)	325			(457		)	693
Net income available to Validus common shareholders	$	7,767		$	89,844		$	94,963		$	166,810		$	69,042		$	359,384		$	374,893
Selected ratios:
Ratio of net to gross premiums written	88.0		%	87.9		%	95.3		%	85.7		%	89.3		%	89.1		%	87.1		%
Losses and loss expenses ratio	50.9		%	45.8		%	53.5		%	39.3		%	39.5		%	47.4		%	43.5		%
Policy acquisition costs ratio	22.4		%	20.1		%	18.8		%	18.8		%	18.8		%	20.0		%	18.3		%
General and administrative expenses ratio (b)	16.3		%	16.5		%	17.6		%	17.0		%	20.0		%	16.8		%	17.9		%
Expense ratio	38.7		%	36.6		%	36.4		%	35.8		%	38.8		%	36.8		%	36.2		%
Combined ratio	89.6		%	82.4		%	89.9		%	75.1		%	78.3		%	84.2		%	79.7		%

Notes:

(a) Net operating income is considered a non-GAAP financial measure. Refer to the Explanatory Notes on page 3 and the Non-GAAP Financial Measure Reconciliation on page 26 for further information.

(b) The general and administrative ratio includes share compensation expenses.

9 of 41

Validus Holdings, Ltd.

Computation of Earnings per Share

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended (a)												Years Ended (a)
	December 31, 2016						December 31, 2015						December 31, 2016						December 31, 2015
	Net Operating Income		Net Income		Comprehensive Income		Net Operating Income		Net Income		Comprehensive Income		Net Operating income		Net Income		Comprehensive income		Net Operating income			Net Income			Comprehensive income
Basic earnings per share (b)
Income available to Validus common shareholders	$	64,323	$	7,767	$	7,846	$	105,395	$	69,042	$	67,342	$	319,198	$	359,384	$	353,192	$	409,749		$	374,893		$	370,880
Less: Dividends on outstanding warrants	—		—		—		—		—		—		—		—		—		(3,566		)	(3,566		)	(3,566		)
Income allocated to Validus common shareholders	$	64,323	$	7,767	$	7,846	$	105,395	$	69,042	$	67,342	$	319,198	$	359,384	$	353,192	$	406,183		$	371,327		$	367,314
Weighted average number of common shares outstanding	79,261,409		79,261,409		79,261,409		82,538,834		82,538,834		82,538,834		81,041,974		81,041,974		81,041,974		83,107,236			83,107,236			83,107,236
Basic earnings per share available to Validus common shareholders	$	0.81	$	0.10	$	0.10	$	1.28	$	0.84	$	0.82	$	3.94	$	4.43	$	4.36	$	4.89		$	4.47		$	4.42
Earnings per diluted share (b)
Income available to Validus common shareholders	$	64,323	$	7,767	$	7,846	$	105,395	$	69,042	$	67,342	$	319,198	$	359,384	$	353,192	$	409,749		$	374,893		$	370,880
Less: Dividends on outstanding warrants	—		—		—		—		—		—		—		—		—		—			—			—
Income allocated to Validus common shareholders	$	64,323	$	7,767	$	7,846	$	105,395	$	69,042	$	67,342	$	319,198	$	359,384	$	353,192	$	409,749		$	374,893		$	370,880
Weighted average number of common shares outstanding	79,261,409		79,261,409		79,261,409		82,538,834		82,538,834		82,538,834		81,041,974		81,041,974		81,041,974		83,107,236			83,107,236			83,107,236
Share equivalents:
Warrants	—		—		—		1,488,315		1,488,315		1,488,315		—		—		—		2,090,248			2,090,248			2,090,248
Stock options	16,403		16,403		16,403		36,181		36,181		36,181		28,196		28,196		28,196		151,867			151,867			151,867
Unvested restricted shares	1,344,155		1,344,155		1,344,155		1,117,928		1,117,928		1,117,928		1,289,290		1,289,290		1,289,290		1,077,409			1,077,409			1,077,409
Weighted average number of diluted common shares outstanding	80,621,967		80,621,967		80,621,967		85,181,258		85,181,258		85,181,258		82,359,460		82,359,460		82,359,460		86,426,760			86,426,760			86,426,760
Earnings per diluted share available to Validus common shareholders	$	0.80	$	0.10	$	0.10	$	1.24	$	0.81	$	0.79	$	3.88	$	4.36	$	4.29	$	4.74		$	4.34		$	4.29

Notes:

(a) ASC 718 requires that any unrecognized stock based compensation expense that will be recorded in future periods be included as proceeds for purposes of treasury stock repurchases, which is applied against the unvested restricted shares balance.

(b) In the basic earnings per share calculation, dividends on preferred shares and outstanding warrants are deducted from net income. In calculating earnings per diluted share, we consider the application of the treasury stock method and the two-class method and which ever is more dilutive is included into the calculation of earnings per diluted share.

10 of 41

Validus Holdings, Ltd.

Computation of Weighted Average Dilutive Common Shares Outstanding

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended						Years Ended
	December 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Average fair value per share	$	52.46		$	45.14		$	48.34		$	43.58
Basic weighted average common shares outstanding	79,261,409			82,538,834			81,041,974			83,107,236
Add: Weighted average dilutive warrants outstanding	—			2,441,241			—			3,540,310
Weighted average exercise price per share	$	—		$	—		$	—		$	13.21
Less: Warrants bought back via treasury method	—			(952,926		)	—			(1,450,062		)
Add: Weighted average dilutive options outstanding	29,241			65,401			50,391			286,073
Weighted average exercise price per share	$	23.48		$	20.17		$	21.90		$	23.01
Less: Options bought back via treasury method	(12,838		)	(29,220		)	(22,195		)	(134,206		)
Add: Weighted average dilutive unvested restricted shares	2,864,861			3,016,761			2,948,359			3,007,578
Proceeds from unrecognized restricted share expenses	$	79,776		$	85,713		$	80,199		$	84,117
Less: Restricted shares bought back via treasury method	(1,520,706		)	(1,898,833		)	(1,659,069		)	(1,930,169		)
Weighted average dilutive common shares outstanding	80,621,967			85,181,258			82,359,460			86,426,760

11 of 41

Validus Holdings, Ltd.

Underwriting Income Statement - Validus Re

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended															Years Ended
	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Underwriting revenues
Gross premiums written	$	38,835		$	94,741		$	285,810		$	691,668		$	14,349		$	1,111,054		$	1,126,759
Reinsurance premiums ceded	94			(15,967		)	(3,196		)	(92,495		)	(87		)	(111,564		)	(149,088		)
Net premiums written	38,929			78,774			282,614			599,173			14,262			999,490			977,671
Change in unearned premiums	185,584			149,705			(35,492		)	(355,342		)	217,652			(55,545		)	12,542
Net premiums earned	224,513			228,479			247,122			243,831			231,914			943,945			990,213
Other insurance related income (loss)	52			58			150			(315		)	257			(55		)	3,575
Total underwriting revenues	224,565			228,537			247,272			243,516			232,171			943,890			993,788
Underwriting deductions
Losses and loss expenses	98,056			98,425			132,139			82,868			100,485			411,488			457,976
Policy acquisition costs	53,380			42,837			42,564			42,259			37,478			181,040			166,387
General and administrative expenses	20,191			17,528			17,872			17,179			20,174			72,770			78,428
Share compensation expenses	2,663			2,695			2,775			2,901			2,685			11,034			10,350
Total underwriting deductions	174,290			161,485			195,350			145,207			160,822			676,332			713,141
Underwriting income	$	50,275		$	67,052		$	51,922		$	98,309		$	71,349		$	267,558		$	280,647
Selected ratios:
Ratio of net to gross premiums written	100.2		%	83.1		%	98.9		%	86.6		%	99.4		%	90.0		%	86.8		%
Losses and loss expenses ratio	43.7		%	43.1		%	53.5		%	34.0		%	43.3		%	43.6		%	46.2		%
Policy acquisition costs ratio	23.8		%	18.7		%	17.2		%	17.4		%	16.1		%	19.2		%	16.8		%
General and administrative expenses ratio (a)	10.1		%	8.9		%	8.4		%	8.2		%	9.9		%	8.8		%	9.0		%
Expense ratio	33.9		%	27.6		%	25.6		%	25.6		%	26.0		%	28.0		%	25.8		%
Combined ratio	77.6		%	70.7		%	79.1		%	59.6		%	69.3		%	71.6		%	72.0		%

Notes:

(a) The general and administrative ratio includes share compensation expenses.

12 of 41

Validus Holdings, Ltd.

Underwriting Results by Class of Business - Three months ended - Validus Re

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended December 31, 2016												Three Months Ended December 31, 2015
	Property			Marine			Specialty (a)			Total			Property			Marine			Specialty (a)			Total
Underwriting revenues
Gross premiums written	$	10,533		$	(4,178	)	$	32,480		$	38,835		$	15,563		$	(681	)	$	(533	)	$	14,349
Reinsurance premiums ceded	99			22			(27		)	94			(305		)	69			149			(87		)
Net premiums written	10,632			(4,156		)	32,453			38,929			15,258			(612		)	(384		)	14,262
Change in unearned premiums	87,112			28,203			70,269			185,584			92,252			34,938			90,462			217,652
Net premiums earned	97,744			24,047			102,722			224,513			107,510			34,326			90,078			231,914
Other insurance related income										52												257
Total underwriting revenues										224,565												232,171
Underwriting deductions
Losses and loss expenses	39,221			5,034			53,801			98,056			30,061			11,272			59,152			100,485
Policy acquisition costs	17,207			5,459			30,714			53,380			16,601			6,766			14,111			37,478
Total underwriting deductions before G&A	56,428			10,493			84,515			151,436			46,662			18,038			73,263			137,963
Underwriting income before G&A	$	41,316		$	13,554		$	18,207		$	73,129		$	60,848		$	16,288		$	16,815		$	94,208
General and administrative expenses										20,191												20,174
Share compensation expenses										2,663												2,685
Total underwriting deductions										174,290												160,822
Underwriting income										$	50,275											$	71,349
Selected ratios:
Ratio of net to gross premiums written	100.9		%	99.5		%	99.9		%	100.2		%	98.0		%	89.9		%	72.0		%	99.4		%
Losses and loss expenses ratio	40.1		%	20.9		%	52.4		%	43.7		%	28.0		%	32.9		%	65.7		%	43.3		%
Policy acquisition costs ratio	17.6		%	22.7		%	29.9		%	23.8		%	15.4		%	19.7		%	15.7		%	16.1		%
General and administrative expenses ratio (b)										10.1		%										9.9		%
Expense ratio										33.9		%										26.0		%
Combined ratio										77.6		%										69.3		%

Notes:

(a) Specialty class includes Aerospace & Aviation, Agriculture, Casualty, Composite, Financial, Technical Lines, Terrorism, Trade Credit, Workers' Compensation and Other Specialty. Other Specialty includes Crisis Management, Contingency and Life and A&H.

(b) The general and administrative expenses ratio includes share compensation expenses.

13 of 41

Validus Holdings, Ltd.

Underwriting Results by Class of Business - Year ended - Validus Re

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Years Ended December 31, 2016												Years Ended December 31, 2015
	Property			Marine			Specialty (a)			Total			Property			Marine			Specialty (a)			Total
Underwriting revenues
Gross premiums written	$	472,965		$	105,698		$	532,391		$	1,111,054		$	547,409		$	152,670		$	426,680		$	1,126,759
Reinsurance premiums ceded	(86,646		)	(12,546		)	(12,372		)	(111,564		)	(121,518		)	(17,127		)	(10,443		)	(149,088		)
Net premiums written	386,319			93,152			520,019			999,490			425,891			135,543			416,237			977,671
Change in unearned premiums	12,499			18,020			(86,064		)	(55,545		)	5,235			12,022			(4,715		)	12,542
Net premiums earned	398,818			111,172			433,955			943,945			431,126			147,565			411,522			990,213
Other insurance related (loss) income										(55		)										3,575
Total underwriting revenues										943,890												993,788
Underwriting deductions
Losses and loss expenses	97,859			45,595			268,034			411,488			86,232			91,306			280,438			457,976
Policy acquisition costs	72,558			19,396			89,086			181,040			74,655			30,024			61,708			166,387
Total underwriting deductions before G&A	170,417			64,991			357,120			592,528			160,887			121,330			342,146			624,363
Underwriting income before G&A	$	228,401		$	46,181		$	76,835		$	351,362		$	270,239		$	26,235		$	69,376		$	369,425
General and administrative expenses										72,770												78,428
Share compensation expenses										11,034												10,350
Total underwriting deductions										676,332												713,141
Underwriting income										$	267,558											$	280,647
Selected ratios:
Ratio of net to gross premiums written	81.7		%	88.1		%	97.7		%	90.0		%	77.8		%	88.8		%	97.6		%	86.8		%
Losses and loss expenses ratio	24.5		%	41.0		%	61.8		%	43.6		%	20.0		%	61.9		%	68.1		%	46.2		%
Policy acquisition costs ratio	18.2		%	17.4		%	20.5		%	19.2		%	17.3		%	20.3		%	15.0		%	16.8		%
General and administrative expenses ratio (b)										8.8		%										9.0		%
Expense ratio										28.0		%										25.8		%
Combined ratio										71.6		%										72.0		%

Notes:

(a) Specialty class includes Aerospace & Aviation, Agriculture, Casualty, Composite, Financial, Technical Lines, Terrorism, Trade Credit, Workers' Compensation and Other Specialty. Other Specialty includes Crisis Management, Contingency and Life and A&H.

(b) The general and administrative expenses ratio includes share compensation expenses.

14 of 41

Validus Holdings, Ltd.

Underwriting Income Statement - Talbot

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended															Years Ended
	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Underwriting revenues
Gross premiums written	$	218,644		$	189,674		$	296,067		$	266,317		$	229,687		$	970,702		$	1,018,835
Reinsurance premiums ceded	(38,233		)	(22,877		)	(27,161		)	(87,458		)	(34,752		)	(175,729		)	(198,896		)
Net premiums written	180,411			166,797			268,906			178,859			194,935			794,973			819,939
Change in unearned premiums	(5,891		)	32,258			(67,357		)	27,933			8,985			(13,057		)	18,152
Net premiums earned	174,520			199,055			201,549			206,792			203,920			781,916			838,091
Other insurance related income	66			99			279			11			287			455			851
Total underwriting revenues	174,586			199,154			201,828			206,803			204,207			782,371			838,942
Underwriting deductions
Losses and loss expenses	105,675			109,860			109,310			100,101			78,810			424,946			347,322
Policy acquisition costs	42,683			46,488			43,613			44,343			46,197			177,127			187,535
General and administrative expenses	24,550			32,333			39,061			38,535			39,965			134,479			155,306
Share compensation expenses	3,123			3,163			3,270			3,522			3,178			13,078			12,373
Total underwriting deductions	176,031			191,844			195,254			186,501			168,150			749,630			702,536
Underwriting (loss) income	$	(1,445	)	$	7,310		$	6,574		$	20,302		$	36,057		$	32,741		$	136,406
Selected ratios:
Ratio of net to gross premiums written	82.5		%	87.9		%	90.8		%	67.2		%	84.9		%	81.9		%	80.5		%
Losses and loss expenses ratio	60.6		%	55.2		%	54.2		%	48.4		%	38.6		%	54.3		%	41.4		%
Policy acquisition costs ratio	24.5		%	23.4		%	21.6		%	21.5		%	22.7		%	22.7		%	22.4		%
General and administrative expenses ratio (a)	15.8		%	17.8		%	21.1		%	20.3		%	21.2		%	18.9		%	20.0		%
Expense ratio	40.3		%	41.2		%	42.7		%	41.8		%	43.9		%	41.6		%	42.4		%
Combined ratio	100.9		%	96.4		%	96.9		%	90.2		%	82.5		%	95.9		%	83.8		%

Notes:

(a) The general and administrative ratio includes share compensation expenses.

15 of 41

Validus Holdings, Ltd.

Underwriting Results by Class of Business - Three months ended - Talbot

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended December 31, 2016												Three Months Ended December 31, 2015
	Property (a)			Marine			Specialty (b)			Total			Property (a)			Marine			Specialty (b)			Total
Underwriting revenues
Gross premiums written	$	71,371		$	39,635		$	107,638		$	218,644		$	73,926		$	60,648		$	95,113		$	229,687
Reinsurance premiums ceded	(20,022		)	(3,049		)	(15,162		)	(38,233		)	(21,957		)	(1,921		)	(10,874		)	(34,752		)
Net premiums written	51,349			36,586			92,476			180,411			51,969			58,727			84,239			194,935
Change in unearned premiums	3,381			15,605			(24,877		)	(5,891		)	2,834			14,192			(8,041		)	8,985
Net premiums earned	54,730			52,191			67,599			174,520			54,803			72,919			76,198			203,920
Other insurance related income										66												287
Total underwriting revenues										174,586												204,207
Underwriting deductions
Losses and loss expenses	46,028			33,053			26,594			105,675			21,911			25,941			30,958			78,810
Policy acquisition costs	9,132			14,816			18,735			42,683			8,474			18,504			19,219			46,197
Total underwriting deductions before G&A	55,160			47,869			45,329			148,358			30,385			44,445			50,177			125,007
Underwriting (loss) income before G&A	$	(430	)	$	4,322		$	22,270		$	26,228		$	24,418		$	28,474		$	26,021		$	79,200
General and administrative expenses										24,550												39,965
Share compensation expenses										3,123												3,178
Total underwriting deductions										176,031												168,150
Underwriting (loss) income										$	(1,445	)										$	36,057
Selected ratios:
Ratio of net to gross premiums written	71.9		%	92.3		%	85.9		%	82.5		%	70.3		%	96.8		%	88.6		%	84.9		%
Losses and loss expenses ratio	84.1		%	63.3		%	39.3		%	60.6		%	40.0		%	35.6		%	40.6		%	38.6		%
Policy acquisition costs ratio	16.7		%	28.4		%	27.7		%	24.5		%	15.5		%	25.4		%	25.2		%	22.7		%
General and administrative expenses ratio (c)										15.8		%										21.2		%
Expense ratio										40.3		%										43.9		%
Combined ratio										100.9		%										82.5		%

Notes:

(a) Property includes Downstream Energy and Power.

(b) Specialty includes Accident & Health, Aviation (Direct & Treaty), Contingency, Financial Lines and Political Lines. Political Lines includes War, Political Risk and Political Violence.

(c) The general and administrative expenses ratio includes share compensation expenses.

16 of 41

Validus Holdings, Ltd.

Underwriting Results by Class of Business - Year ended - Talbot

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Years Ended December 31, 2016												Years Ended December 31, 2015
	Property (a)			Marine			Specialty (b)			Total			Property (a)			Marine			Specialty (b)			Total
Underwriting revenues
Gross premiums written	$	317,085		$	261,940		$	391,677		$	970,702		$	327,122		$	327,539		$	364,174		$	1,018,835
Reinsurance premiums ceded	(86,308		)	(29,502		)	(59,919		)	(175,729		)	(103,677		)	(34,087		)	(61,132		)	(198,896		)
Net premiums written	230,777			232,438			331,758			794,973			223,445			293,452			303,042			819,939
Change in unearned premiums	(2,923		)	27,782			(37,916		)	(13,057		)	(2,142		)	25,506			(5,212		)	18,152
Net premiums earned	227,854			260,220			293,842			781,916			221,303			318,958			297,830			838,091
Other insurance related income										455												851
Total underwriting revenues										782,371												838,942
Underwriting deductions
Losses and loss expenses	142,669			147,158			135,119			424,946			86,807			130,521			129,994			347,322
Policy acquisition costs	37,082			68,593			71,452			177,127			32,768			82,705			72,062			187,535
Total underwriting deductions before G&A	179,751			215,751			206,571			602,073			119,575			213,226			202,056			534,857
Underwriting income before G&A	$	48,103		$	44,469		$	87,271		$	180,298		$	101,728		$	105,732		$	95,774		$	304,085
General and administrative expenses										134,479												155,306
Share compensation expenses										13,078												12,373
Total underwriting deductions										749,630												702,536
Underwriting income										$	32,741											$	136,406
Selected ratios:
Ratio of net to gross premiums written	72.8		%	88.7		%	84.7		%	81.9		%	68.3		%	89.6		%	83.2		%	80.5		%
Losses and loss expenses ratio	62.6		%	56.6		%	46.0		%	54.3		%	39.2		%	40.9		%	43.6		%	41.4		%
Policy acquisition costs ratio	16.3		%	26.4		%	24.3		%	22.7		%	14.8		%	25.9		%	24.2		%	22.4		%
General and administrative expenses ratio (c)										18.9		%										20.0		%
Expense ratio										41.6		%										42.4		%
Combined ratio										95.9		%										83.8		%

Notes:

(a) Property includes Downstream Energy and Power.

(b) Specialty includes Accident & Health, Aviation (Direct & Treaty), Contingency, Financial Lines and Political Lines. Political Lines includes War, Political Risk and Political Violence.

(c) The general and administrative expenses ratio includes share compensation expenses.

17 of 41

Validus Holdings, Ltd.

Underwriting Income Statement - Western World

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended															Years Ended
	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Underwriting revenues
Gross premiums written	$	87,030		$	85,260		$	86,971		$	63,959		$	71,132		$	323,220		$	278,504
Reinsurance premiums ceded	(7,287		)	(6,202		)	(5,006		)	(4,139		)	(5,487		)	(22,634		)	(18,877		)
Net premiums written	79,743			79,058			81,965			59,820			65,645			300,586			259,627
Change in unearned premiums	(4,464		)	(8,260		)	(16,309		)	1,679			(3,925		)	(27,354		)	(977		)
Net premiums earned	75,279			70,798			65,656			61,499			61,720			273,232			258,650
Other insurance related income	216			219			189			288			257			912			1,044
Total underwriting revenues	75,495			71,017			65,845			61,787			61,977			274,144			259,694
Underwriting deductions
Losses and loss expenses	54,189			45,748			44,229			39,646			33,780			183,812			171,878
Policy acquisition costs	17,738			17,094			15,410			14,200			14,298			64,442			41,408
General and administrative expenses	9,576			10,171			11,458			12,075			9,578			43,280			38,715
Share compensation expenses	718			702			542			581			558			2,543			2,083
Total underwriting deductions	82,221			73,715			71,639			66,502			58,214			294,077			254,084
Underwriting (loss) income	$	(6,726	)	$	(2,698	)	$	(5,794	)	$	(4,715	)	$	3,763		$	(19,933	)	$	5,610
Selected ratios:
Ratio of net to gross premiums written	91.6		%	92.7		%	94.2		%	93.5		%	92.3		%	93.0		%	93.2		%
Losses and loss expenses ratio	72.0		%	64.6		%	67.4		%	64.5		%	54.7		%	67.3		%	66.4		%
Policy acquisition costs ratio	23.5		%	24.1		%	23.5		%	23.1		%	23.2		%	23.5		%	16.0		%
General and administrative expenses ratio (a)	13.7		%	15.4		%	18.2		%	20.5		%	16.4		%	16.8		%	15.8		%
Expense ratio	37.2		%	39.5		%	41.7		%	43.6		%	39.6		%	40.3		%	31.8		%
Combined ratio	109.2		%	104.1		%	109.1		%	108.1		%	94.3		%	107.6		%	98.2		%

Notes:

(a) The general and administrative ratio includes share compensation expenses.

18 of 41

Validus Holdings, Ltd.

Underwriting Results by Class of Business - Three months ended - Western World

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended December 31, 2016									Three Months Ended December 31, 2015
	Property			Liability (a)			Total			Property			Liability (a)			Total
Underwriting revenues
Gross premiums written	$	29,039		$	57,991		$	87,030		$	13,884		$	57,248		$	71,132
Reinsurance premiums ceded	(3,675		)	(3,612		)	(7,287		)	(1,167		)	(4,320		)	(5,487		)
Net premiums written	25,364			54,379			79,743			12,717			52,928			65,645
Change in unearned premiums	(5,280		)	816			(4,464		)	(1,139		)	(2,786		)	(3,925		)
Net premiums earned	20,084			55,195			75,279			11,578			50,142			61,720
Other insurance related income							216									257
Total underwriting revenues							75,495									61,977
Underwriting deductions
Losses and loss expenses	16,634			37,555			54,189			2,787			30,993			33,780
Policy acquisition costs	5,175			12,563			17,738			2,886			11,412			14,298
Total underwriting deductions before G&A	21,809			50,118			71,927			5,673			42,405			48,078
Underwriting (loss) income before G&A	$	(1,725	)	$	5,077		$	3,568		$	5,905		$	7,737		$	13,899
General and administrative expenses							9,576									9,578
Share compensation expenses							718									558
Total underwriting deductions							82,221									58,214
Underwriting (loss) income							$	(6,726	)							$	3,763
Selected ratios:
Ratio of net to gross premiums written	87.3		%	93.8		%	91.6		%	91.6		%	92.5		%	92.3		%
Losses and loss expenses ratio	82.8		%	68.0		%	72.0		%	24.1		%	61.8		%	54.7		%
Policy acquisition costs ratio	25.8		%	22.8		%	23.5		%	24.9		%	22.8		%	23.2		%
General and administrative expenses ratio (b)							13.7		%							16.4		%
Expense ratio							37.2		%							39.6		%
Combined ratio							109.2		%							94.3		%

Notes:

(a) Liability includes general liability, professional liability, products liability and miscellaneous malpractice.

(b) The general and administrative expenses ratio includes share compensation expenses.

19 of 41

Validus Holdings, Ltd.

Underwriting Results by Class of Business - Year ended - Western World

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Years Ended December 31, 2016									Years Ended December 31, 2015
	Property			Liability (a)			Total			Property			Liability (a)			Total
Underwriting revenues
Gross premiums written	$	94,440		$	228,780		$	323,220		$	53,018		$	225,486		$	278,504
Reinsurance premiums ceded	(10,070		)	(12,564		)	(22,634		)	(4,347		)	(14,530		)	(18,877		)
Net premiums written	84,370			216,216			300,586			48,671			210,956			259,627
Change in unearned premiums	(21,216		)	(6,138		)	(27,354		)	(4,588		)	3,611			(977		)
Net premiums earned	63,154			210,078			273,232			44,083			214,567			258,650
Other insurance related income							912									1,044
Total underwriting revenues							274,144									259,694
Underwriting deductions
Losses and loss expenses	45,469			138,343			183,812			23,104			148,774			171,878
Policy acquisition costs	15,840			48,602			64,442			6,948			34,460			41,408
Total underwriting deductions before G&A	61,309			186,945			248,254			30,052			183,234			213,286
Underwriting income before G&A	$	1,845		$	23,133		$	25,890		$	14,031		$	31,333		$	46,408
General and administrative expenses							43,280									38,715
Share compensation expenses							2,543									2,083
Total underwriting deductions							294,077									254,084
Underwriting (loss) income							$	(19,933	)							$	5,610
Selected ratios:
Ratio of net to gross premiums written	89.3		%	94.5		%	93.0		%	91.8		%	93.6		%	93.2		%
Losses and loss expenses ratio	72.0		%	65.9		%	67.3		%	52.4		%	69.3		%	66.4		%
Policy acquisition costs ratio	25.1		%	23.1		%	23.5		%	15.8		%	16.1		%	16.0		%
General and administrative expenses ratio (b)							16.8		%							15.8		%
Expense ratio							40.3		%							31.8		%
Combined ratio							107.6		%							98.2		%

Notes:

(a) Liability includes general liability, professional liability, products liability and miscellaneous malpractice.

(b) The general and administrative expenses ratio includes share compensation expenses.

20 of 41

Validus Holdings, Ltd.

AlphaCat Managers Segment Information

(Expressed in thousands of U.S. Dollars)

	Three Months Ended															Years Ended
	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Revenues
Third party	$	3,928		$	7,025		$	3,091		$	4,727		$	5,039		$	18,771		$	19,661
Related party	737			1,373			328			891			1,251			3,329			5,309
Total revenues	4,665			8,398			3,419			5,618			6,290			22,100			24,970
Expenses
General and administrative expenses	2,676			3,324			2,751			1,482			3,232			10,233			12,115
Share compensation expenses	82			(107		)	133			141			140			249			580
Finance expenses	33			31			75			808			53			947			9,312
Tax expenses	90			—			—			—			—			90			—
Foreign exchange gains (losses)	2			5			4			8			(7		)	19			(16		)
Total expenses	2,883			3,253			2,963			2,439			3,418			11,538			21,991
Income before investment income from AlphaCat Funds and Sidecars	1,782			5,145			456			3,179			2,872			10,562			2,979
Investment income (loss) from AlphaCat Funds and Sidecars (b)
AlphaCat Sidecars	14			(72		)	541			124			1,618			607			5,504
AlphaCat ILS Funds - Lower Risk (c)	1,998			2,321			2,075			2,507			2,037			8,901			7,491
AlphaCat ILS Funds - Higher Risk (c)	1,864			2,479			692			2,436			1,820			7,471			8,428
BetaCat ILS Funds	644			1,303			1,113			563			461			3,623			1,702
PaCRe	—			—			—			(23		)	(1,708		)	(23		)	(3,949		)
Total investment income from AlphaCat Funds and Sidecars	4,520			6,031			4,421			5,607			4,228			20,579			19,176
Validus' share of AlphaCat income	$	6,302		$	11,176		$	4,877		$	8,786		$	7,100		$	31,141		$	22,155
Gross premiums written
AlphaCat Sidecars	$	(163	)	$	(112	)	$	(14	)	$	(52	)	$	329		$	(341	)	$	45,755
AlphaCat ILS Funds - Lower Risk (c)	(19		)	2,049			50,234			59,958			1,275			112,222			91,363
AlphaCat ILS Funds - Higher Risk (c)	(105		)	1,797			42,010			96,320			36			140,022			34,228
AlphaCat Direct (d)	23			679			6,675			11,122			(5		)	18,499			4,780
Total	$	(264	)	$	4,413		$	98,905		$	167,348		$	1,635		$	270,402		$	176,126

Notes:

(a) The results of AlphaCat are presented on an asset manager basis, which is non-GAAP.

(b) The investment income from AlphaCat funds and sidecars is based on equity accounting.

(c) Lower risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of less than 7%, whereas higher risk AlphaCat ILS funds have a maximum permitted portfolio expected loss of greater than 7%. Expected loss represents the average annual loss over the set of simulation scenarios divided by the total limit.

(d) AlphaCat Direct includes direct investments from a third party investor in AlphaCat Reinsurance Ltd.

21 of 41

Validus Holdings, Ltd.

AlphaCat Assets Under Management

(Expressed in thousands of U.S. Dollars)

	As at
	January 1, 2017		October 1, 2016		July 1, 2016		April 1, 2016		January 1, 2016
Assets Under Management - Related Party	Related Party
AlphaCat Sidecars	$	7,729	$	7,922	$	8,045	$	10,122	$	35,416
AlphaCat ILS Funds - Lower Risk	124,297		181,744		175,832		167,497		164,014
AlphaCat ILS Funds - Higher Risk	83,881		81,636		76,287		67,621		65,464
AlphaCat Direct	—		—		—		—		—
BetaCat ILS Funds	26,808		51,160		63,453		62,336		61,749
Total	$	242,715	$	322,462	$	323,617	$	307,576	$	326,643
Assets Under Management - Third Party	Third Party
AlphaCat Sidecars	$	28,829	$	29,603	$	30,078	$	38,385	$	154,386
AlphaCat ILS Funds - Lower Risk	1,257,287		1,276,874		1,226,709		1,135,635		1,102,462
AlphaCat ILS Funds - Higher Risk	738,813		612,456		564,513		466,324		434,851
AlphaCat Direct	444,668		373,659		365,558		370,032		367,820
BetaCat ILS Funds	29,000		—		—		—		—
Total	$	2,498,597	$	2,292,592	$	2,186,858	$	2,010,376	$	2,059,519
Total Assets Under Management	$	2,741,312	$	2,615,054	$	2,510,475	$	2,317,952	$	2,386,162

Notes:

(a) The Company’s assets under management are based on NAV and are represented by investments made by related parties and third parties in the feeder funds and on a direct basis.

22 of 41

Validus Holdings, Ltd.

Corporate and Investments

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended															Years Ended
	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Investment income
Managed net investment income (a)	$	35,875		$	41,071		$	36,849		$	27,923		$	29,885		$	141,718		$	121,166
Operating expenses
General and administrative expenses	$	19,973		$	18,221		$	17,872		$	16,183		$	24,222		$	72,249		$	75,724
Share compensation expenses	3,856			4,048			4,007			4,092			3,501			16,003			12,955
Finance expenses (a)	14,546			14,317			13,979			14,341			15,448			57,183			61,071
Dividends on preferred shares	2,203			2,252			—			—			—			4,455			—
Tax (benefit) expense (a)	(21,237		)	1,830			1,706			(2,118		)	(756		)	(19,819		)	6,376
Total operating expenses	$	19,341		$	40,668		$	37,564		$	32,498		$	42,415		$	130,071		$	156,126
Other items
Net realized gains (losses) on managed investments (a)	$	9,166		$	4,080		$	2,520		$	(1,086	)	$	(3,353	)	$	14,680		$	1,698
Change in net unrealized (losses) gains on managed investments (a)	(67,676		)	4,652			30,052			47,078			(34,515		)	14,106			(32,007		)
Income (loss) from investment affiliates	2,166			453			(589		)	(4,113		)	(1,261		)	(2,083		)	4,281
Foreign exchange (losses) gains (a)	(850		)	(1,067		)	6,621			6,074			852			10,778			(8,172		)
Other income (loss)	7			(1,529		)	79			677			1,576			(766		)	(1,002		)
Total other items	$	(57,187	)	$	6,589		$	38,683		$	48,630		$	(36,701	)	$	36,715		$	(35,202	)
Total Corporate and Investments	$	(40,653	)	$	6,992		$	37,968		$	44,055		$	(49,231	)	$	48,362		$	(70,162	)

Notes:

(a) These items exclude the components which are included in Validus' share of AlphaCat and amounts which are consolidated from variable interest entities.

23 of 41

Validus Holdings, Ltd.

Segment Reconciliation - Three months ended

(Expressed in millions of U.S. Dollars, except share and per share information)

	Three Months Ended December 31, 2016
	Validus Re Segment			Talbot Segment			Western World Segment			AlphaCat & Consolidated Variable Interest Entities			Corporate & Investments			Eliminations			Total
Underwriting revenues
Gross premiums written	$	38,835		$	218,644		$	87,030		$	(264	)	$	—		$	(4,791	)	$	339,454
Reinsurance premiums ceded	94			(38,233		)	(7,287		)	—			—			4,791			(40,635		)
Net premiums written	38,929			180,411			79,743			(264		)	—			—			298,819
Change in unearned premiums	185,584			(5,891		)	(4,464		)	66,351			—			—			241,580
Net premiums earned	224,513			174,520			75,279			66,087			—			—			540,399
Other insurance related income (loss)	52			66			216			4,664			—			(4,437		)	561
Total underwriting revenues	224,565			174,586			75,495			70,751			—			(4,437		)	540,960
Underwriting deductions
Losses and loss expenses	98,056			105,675			54,189			17,206			—			—			275,126
Policy acquisition costs	53,380			42,683			17,738			7,143			—			(55		)	120,889
General and administrative expenses	20,191			24,550			9,576			8,061			19,973			(4,396		)	77,955
Share compensation expenses	2,663			3,123			718			82			3,856			—			10,442
Total underwriting deductions	174,290			176,031			82,221			32,492			23,829			(4,451		)	484,412
Underwriting income (loss)	$	50,275		$	(1,445	)	$	(6,726	)	$	38,259		$	(23,829	)	$	14		$	56,548
Other items (a)										45			(50,496		)				(50,451		)
Dividends on preferred shares													(2,203		)				(2,203		)
Net investment income										2,278			35,875			—			38,153
(Income) attributable to AlphaCat investors										(7,080		)	—						(7,080		)
Net (income) attributable to noncontrolling interest										(27,200		)	—						(27,200		)
Segmental income (loss)	50,275			(1,445		)	(6,726		)	6,302			(40,653		)	14
Net income available to Validus common shareholders																			$	7,767
	Three Months Ended December 31, 2015
	Validus Re Segment			Talbot Segment			Western World Segment			AlphaCat & Consolidated Variable Interest Entities			Corporate & Investments			Eliminations			Total
Underwriting revenues
Gross premiums written	$	14,349		$	229,687		$	71,132		$	1,635		$	—		$	(7,198	)	$	309,605
Reinsurance premiums ceded	(87		)	(34,752		)	(5,487		)	—			—			7,198			(33,128		)
Net premiums written	14,262			194,935			65,645			1,635			—			—			276,477
Change in unearned premiums	217,652			8,985			(3,925		)	44,111			—			—			266,823
Net premiums earned	231,914			203,920			61,720			45,746			—			—			543,300
Other insurance related income (loss)	257			287			257			6,349			—			(6,181		)	969
Total underwriting revenues	232,171			204,207			61,977			52,095			—			(6,181		)	544,269
Underwriting deductions
Losses and loss expenses	100,485			78,810			33,780			1,673			—			—			214,748
Policy acquisition costs	37,478			46,197			14,298			4,544			—			(232		)	102,285
General and administrative expenses	20,174			39,965			9,578			10,577			24,222			(5,953		)	98,563
Share compensation expenses	2,685			3,178			558			140			3,501			—			10,062
Total underwriting deductions	160,822			168,150			58,214			16,934			27,723			(6,185		)	425,658
Underwriting income (loss)	$	71,349		$	36,057		$	3,763		$	35,161		$	(27,723	)	$	4		$	118,611
Other items (a)										(2,818		)	(51,393		)				(54,211		)
Dividends on preferred shares													—						—
Net investment income										1,727			29,885						31,612
(Income) attributable to AlphaCat investors										(974		)	—						(974		)
Net (income) attributable to noncontrolling interest										(25,996		)	—						(25,996		)
Segmental income (loss)	71,349			36,057			3,763			7,100			(49,231		)	4
Net income available to Validus common shareholders																			$	69,042

Notes:

(a) Other items includes finance expenses, tax benefit (expense), foreign exchange gains (losses), net realized and change in unrealized gains (losses) on investments, income from investment and operating affiliates and other income (loss).

24 of 41

Validus Holdings, Ltd.

Segment Reconciliation - Year ended

(Expressed in millions of U.S. Dollars, except share and per share information)

	Years Ended December 31, 2016
	Validus Re Segment			Talbot Segment			Western World Segment			AlphaCat & Consolidated Variable Interest Entities			Corporate & Investments			Eliminations			Total
Underwriting revenues
Gross premiums written	$	1,111,054		$	970,702		$	323,220		$	270,402		$	—		$	(26,673	)	$	2,648,705
Reinsurance premiums ceded	(111,564		)	(175,729		)	(22,634		)	(6,451		)	—			26,673			(289,705		)
Net premiums written	999,490			794,973			300,586			263,951			—			—			2,359,000
Change in unearned premiums	(55,545		)	(13,057		)	(27,354		)	(13,879		)	—			—			(109,835		)
Net premiums earned	943,945			781,916			273,232			250,072			—			—			2,249,165
Other insurance related (loss) income	(55		)	455			912			22,386			—			(20,737		)	2,961
Total underwriting revenues	943,890			782,371			274,144			272,458			—			(20,737		)	2,252,126
Underwriting deductions
Losses and loss expenses	411,488			424,946			183,812			44,851			—			—			1,065,097
Policy acquisition costs	181,040			177,127			64,442			26,905			—			(32		)	449,482
General and administrative expenses	72,770			134,479			43,280			34,333			72,249			(20,817		)	336,294
Share compensation expenses	11,034			13,078			2,543			249			16,003			—			42,907
Total underwriting deductions	676,332			749,630			294,077			106,338			88,252			(20,849		)	1,893,780
Underwriting income (loss)	$	267,558		$	32,741		$	(19,933	)	$	166,120		$	(88,252	)	$	112		$	358,346
Other items (a)										2,478			(649		)				1,829
Dividends on preferred shares													(4,455		)				(4,455		)
Net investment income										9,264			141,718			(597		)	150,385
(Income) attributable to AlphaCat investors										(23,358		)	—						(23,358		)
Net (income) attributable to noncontrolling interest										(123,363		)	—						(123,363		)
Segmental income (loss)	267,558			32,741			(19,933		)	31,141			48,362			(485		)
Net income available to Validus common shareholders																			$	359,384
	Years Ended December 31, 2015
	Validus Re Segment			Talbot Segment			Western World Segment			AlphaCat & Consolidated Variable Interest Entities			Corporate & Investments			Eliminations			Total
Underwriting revenues
Gross premiums written	$	1,126,759		$	1,018,835		$	278,504		$	176,126					$	(42,718	)	$	2,557,506
Reinsurance premiums ceded	(149,088		)	(198,896		)	(18,877		)	(4,538		)				42,718			(328,681		)
Net premiums written	977,671			819,939			259,627			171,588						—			2,228,825
Change in unearned premiums	12,542			18,152			(977		)	(11,653		)				—			18,064
Net premiums earned	990,213			838,091			258,650			159,935						—			2,246,889
Other insurance related income (loss)	3,575			851			1,044			25,524						(24,881		)	6,113
Total underwriting revenues	993,788			838,942			259,694			185,459						(24,881		)	2,253,002
Underwriting deductions
Losses and loss expenses	457,976			347,322			171,878			657						—			977,833
Policy acquisition costs	166,387			187,535			41,408			16,327						(1,599		)	410,058
General and administrative expenses	78,428			155,306			38,715			39,055			75,724			(23,519		)	363,709
Share compensation expenses	10,350			12,373			2,083			580			12,955			—			38,341
Total underwriting deductions	713,141			702,536			254,084			56,619			88,679			(25,118		)	1,789,941
Underwriting income (loss)	$	280,647		$	136,406		$	5,610		$	128,840		$	(88,679	)	$	237		$	463,061
Other items (a)										(17,967		)	(102,649		)				(120,616		)
Dividends on preferred shares													—						—
Net investment income										6,658			121,166						127,824
(Income) attributable to AlphaCat investors										(2,412		)	—						(2,412		)
Net (income) attributable to noncontrolling interest										(92,964		)	—						(92,964		)
Segmental income (loss)	280,647			136,406			5,610			22,155			(70,162		)	237
Net income available to Validus common shareholders																			$	374,893

Notes:

(a) Other items includes finance expenses, tax benefit (expense), foreign exchange gains (losses), net realized and change in unrealized gains (losses) on investments, income from investment and operating affiliates and other income (loss).

25 of 41

Validus Holdings, Ltd.

Non-GAAP Financial Measure Reconciliation

Net Operating Income available to Validus Common Shareholders, Net Operating Income per share available to Validus Common Shareholders and Annualized Net Operating Return on Average Equity

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended						Years Ended
	December 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Net income available to Validus common shareholders	$	7,767		$	69,042		$	359,384		$	374,893
Adjustments for:
Net realized (gains) losses on investments	(9,220		)	2,928			(15,757		)	(2,298		)
Change in net unrealized losses (gains) on investments	67,460			34,862			(16,871		)	32,395
(Income) loss from investment affiliates	(2,166		)	1,261			2,083			(4,281		)
Foreign exchange losses (gains)	901			(797		)	(10,864		)	8,731
Other (income) loss	(7		)	(1,576		)	766			1,002
Net (loss) income attributable to noncontrolling interest	(412		)	(325		)	457			(693		)
Net operating income available to Validus common shareholders	$	64,323		$	105,395		$	319,198		$	409,749
Net investment income	(38,153		)	(31,612		)	(150,385		)	(127,824		)
Finance expenses	14,630			16,581			58,520			74,742
Dividends on preferred shares	2,203			—			4,455			—
Tax (benefit) expense	(21,147		)	(756		)	(19,729		)	6,376
Loss from operating affiliate	—			1,708			23			3,949
Income attributable to AlphaCat investors	7,080			974			23,358			2,412
Net operating income attributable to noncontrolling interest	27,612			26,321			122,906			93,657
Underwriting income	$	56,548		$	118,611		$	358,346		$	463,061
Net operating income available to Validus common shareholders	$	64,323		$	105,395		$	319,198		$	409,749
Less: Dividends on outstanding warrants	—			—			—			(3,566		)
Net operating income allocated to Validus, adjusted	$	64,323		$	105,395		$	319,198		$	406,183
Net income per share available to Validus common shareholders - diluted	$	0.10		$	0.81		$	4.36		$	4.34
Adjustments for:
Net realized (gains) losses on investments	(0.11		)	0.03			(0.19		)	(0.03		)
Change in net unrealized losses (gains) on investments	0.84			0.42			(0.20		)	0.38
(Income) loss from investment affiliates	(0.03		)	0.01			0.03			(0.05		)
Foreign exchange losses (gains)	0.01			(0.01		)	(0.14		)	0.10
Other (income) loss	—			(0.02		)	0.01			0.01
Net (loss) income attributable to noncontrolling interest	(0.01		)	—			0.01			(0.01		)
Net operating income per share available to Validus common shareholders - diluted	$	0.80		$	1.24		$	3.88		$	4.74
Weighted average number of common shares and common share equivalents	80,621,967			85,181,258			82,359,460			86,426,760
Average shareholders' equity available to Validus common shareholders	$	3,702,956		$	3,641,970		$	3,697,114		$	3,641,920
Annualized return on average equity	0.8		%	7.6		%	9.7		%	10.3		%
Annualized net operating return on average equity	6.9		%	11.6		%	8.6		%	11.3		%

26 of 41

Validus Holdings, Ltd.

Consolidated Class of Business Policy Type Detail - Gross Premiums Written

(Expressed in thousands of U.S. Dollars, except share and per share information)

		Three Months Ended								Years Ended
		December 31, 2016				December 31, 2015				December 31, 2016				December 31, 2015
Line of business	Treaty type	Gross premiums written		%		Gross premiums written		%		Gross premiums written		%		Gross premiums written		%
Property	Treaty Reinsurance	$	8,209	2.4	%	$	17,717	5.7	%	$	757,381	28.6	%	$	743,012	29.1	%
	Facultative Reinsurance	34,363		10.1	%	33,668		10.9	%	133,525		5.0	%	136,352		5.3	%
	Direct Insurance	61,868		18.2	%	47,035		15.2	%	237,617		9.0	%	198,336		7.8	%
		104,440		30.7	%	98,420		31.8	%	1,128,523		42.6	%	1,077,700		42.2	%
Marine	Treaty Reinsurance	730		0.2	%	6,630		2.1	%	140,408		5.3	%	188,141		7.3	%
	Facultative Reinsurance	7,454		2.2	%	11,541		3.7	%	68,106		2.6	%	86,378		3.4	%
	Direct Insurance	28,894		8.5	%	41,518		13.5	%	155,142		5.9	%	197,338		7.7	%
		37,078		10.9	%	59,689		19.3	%	363,656		13.8	%	471,857		18.4	%
Specialty (a)	Treaty Reinsurance	47,453		14.0	%	10,467		3.4	%	603,290		22.8	%	462,287		18.1	%
	Facultative Reinsurance	26,467		7.8	%	27,433		8.9	%	92,110		3.5	%	102,581		4.0	%
	Direct Insurance	66,025		19.5	%	56,348		18.2	%	232,346		8.7	%	217,595		8.5	%
		139,945		41.3	%	94,248		30.5	%	927,746		35.0	%	782,463		30.6	%
Liability (b)	Direct Insurance	57,991		17.1	%	57,248		18.4	%	228,780		8.6	%	225,486		8.8	%
		57,991		17.1	%	57,248		18.4	%	228,780		8.6	%	225,486		8.8	%
Total	Treaty Reinsurance	56,392		16.6	%	34,814		11.2	%	1,501,079		56.7	%	1,393,440		54.5	%
	Facultative Reinsurance	68,284		20.1	%	72,642		23.5	%	293,741		11.1	%	325,311		12.7	%
	Direct Insurance	214,778		63.3	%	202,149		65.3	%	853,885		32.2	%	838,755		32.8	%
		$	339,454	100.0	%	$	309,605	100.0	%	$	2,648,705	100.0	%	$	2,557,506	100.0	%
Total	Reinsurance	56,392		16.6	%	34,814		11.2	%	1,501,079		56.7	%	1,393,440		54.5	%
	Insurance (c)	283,062		83.4	%	274,791		88.8	%	1,147,626		43.3	%	1,164,066		45.5	%
		$	339,454	100.0	%	$	309,605	100.0	%	$	2,648,705	100.0	%	$	2,557,506	100.0	%

Notes:

(a) For the Validus Re segment, the Specialty class includes Aerospace & Aviation, Agriculture, Casualty, Composite, Financial, Technical Lines, Terrorism, Trade Credit, Workers' Compensation and Other Specialty. Other Specialty includes Contingency, Crisis Management and Life and A&H. For the Talbot segment, Specialty includes Accident & Health, Aviation (Direct & Treaty), Contingency, Financial Lines and Political Lines. Political lines includes War, Political Risk and Political Violence. For the AlphaCat segment, Specialty includes Agriculture, Composite and Workers' Compensation.

(b) For the Western World segment, the Liability class includes general liability, professional liability, products liability and miscellaneous malpractice.

(c) Insurance includes facultative reinsurance and direct insurance.

27 of 41

Validus Holdings, Ltd.

Gross Premiums Written by Segment by Class of Business

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended															Years Ended
	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Validus Re
Property - Cat XOL (a)	$	1,150		$	33,032		$	185,253		$	126,074		$	2,651		$	345,509		$	419,931
Property - Per Risk XOL	238			10,525			4,640			11,419			541			26,822			26,180
Property - Proportional (b)	9,145			10,204			26,141			55,144			12,371			100,634			101,298
Marine	(4,178		)	(4,533		)	7,806			106,603			(681		)	105,698			152,670
Aerospace & Aviation	(1,574		)	888			6,875			13,051			644			19,240			21,164
Agriculture	(9,681		)	8,625			15,480			228,756			(15,001		)	243,180			270,524
Casualty	31,991			7,539			22,990			23,587			7,117			86,107			7,117
Composite	2,281			8,932			7,404			40,627			906			59,244			41,130
Financial	10,163			9,565			3,790			22,733			891			46,251			16,882
Technical Lines	629			4,100			2,154			5,651			1,219			12,534			7,894
Terrorism	(2,116		)	2,116			(1,346		)	12,286			246			10,940			19,782
Trade Credit	28			(647		)	36			38,862			1,693			38,279			24,145
Workers' Compensation	732			3,230			683			3,419			383			8,064			7,398
Other Specialty (c)	27			1,165			3,904			3,456			1,369			8,552			10,644
Total Validus Re Segment	38,835			94,741			285,810			691,668			14,349			1,111,054			1,126,759
AlphaCat
Property - Cat XOL (a)	(264		)	3,933			93,282			163,835			1,635			260,786			176,126
Agriculture	4			77			2,798			—			—			2,879			—
Composite	—			—			2,821			2,697			—			5,518			—
Workers' Compensation	(4		)	403			4			816			—			1,219			—
Total AlphaCat Segment	(264		)	4,413			98,905			167,348			1,635			270,402			176,126
Talbot
Property	46,499			44,982			76,424			54,983			44,573			222,888			223,186
Downstream Energy and Power	24,872			19,319			35,222			14,784			29,353			94,197			103,936
Marine	39,635			48,093			85,992			88,220			60,648			261,940			327,539
Accident & Health	4,929			4,170			8,861			11,366			6,880			29,326			27,123
Aviation, Direct	16,398			10,241			8,676			5,916			19,801			41,231			51,851
Aviation Treaty	3,355			4,810			15,053			20,364			7,154			43,582			35,718
Contingency	14,160			6,183			6,665			8,404			4,202			35,412			17,335
Financial Lines	15,308			13,594			11,473			10,105			11,226			50,480			44,703
Political Lines (d)	53,488			38,282			47,701			52,175			45,850			191,646			187,444
Total Talbot Segment	218,644			189,674			296,067			266,317			229,687			970,702			1,018,835
Western World
Property	29,039			23,757			26,218			15,426			13,884			94,440			53,018
Liability (e)	57,991			61,503			60,753			48,533			57,248			228,780			225,486
Total Western World Segment	87,030			85,260			86,971			63,959			71,132			323,220			278,504
Intersegment Revenue
Property	(6,239		)	(1,284		)	(3,484		)	(5,746		)	(6,588		)	(16,753		)	(25,975		)
Marine	1,621			466			(211		)	(5,858		)	(278		)	(3,982		)	(8,352		)
Specialty	(173		)	(852		)	(16		)	(4,897		)	(332		)	(5,938		)	(8,391		)
Total Intersegment Revenue Eliminated	(4,791		)	(1,670		)	(3,711		)	(16,501		)	(7,198		)	(26,673		)	(42,718		)
Total Gross Premiums Written	$	339,454		$	372,418		$	764,042		$	1,172,791		$	309,605		$	2,648,705		$	2,557,506

Notes:

(a) Property Cat XOL is comprised of Catastrophe XOL, Aggregate XOL, RPP. Per Event XOL, Second Event and Third Event covers.

(b) Proportional is comprised of Quota Share and Surplus Share cover.

(c) Other Specialty includes Contingency, Crisis Management and Life and A&H.

(d) Political Lines includes War, Political Risk and Political Violence.

(e) Liability includes includes general liability, professional liability, products liability and miscellaneous malpractice.

28 of 41

Validus Holdings, Ltd.

Consolidated Analysis of Reserves for Losses and Loss Expenses

(Expressed in thousands of U.S. Dollars, except share and per share information)

	At December 31, 2016									At December 31, 2015
	Reserve for losses and loss expenses			Loss reserves recoverable			Net			Reserve for losses and loss expenses			Loss reserves recoverable			Net
Property (a)	$	830,672		$	107,573		$	723,099		$	871,543		$	95,966		$	775,577
Marine	861,459			154,001			707,458			806,361			84,072			722,289
Specialty (b)	732,907			81,547			651,360			730,840			85,461			645,379
Liability (c)	570,157			87,300			482,857			587,823			85,087			502,736
Total	$	2,995,195		$	430,421		$	2,564,774		$	2,996,567		$	350,586		$	2,645,981
	At December 31, 2016									At December 31, 2015
	Case Reserves			IBNR			Total Reserves			Case Reserves			IBNR			Total Reserves
Property (a)	$	390,141		$	440,531		$	830,672		$	426,772		$	444,771		$	871,543
Marine	389,614			471,845			861,459			386,161			420,200			806,361
Specialty (b)	259,251			473,656			732,907			282,310			448,530			730,840
Liability (c)	198,766			371,391			570,157			183,454			404,369			587,823
Total	$	1,237,772		$	1,757,423		$	2,995,195		$	1,278,697		$	1,717,870		$	2,996,567
% of Total	41.3		%	58.7		%	100.0		%	42.7		%	57.3		%	100.0		%

Notes:

(a) For the Talbot segment, the Property class includes Downstream Energy and Power.

(b) For the Validus Re segment, the Specialty class includes Aerospace & Aviation, Agriculture, Casualty, Composite, Financial, Technical Lines, Terrorism, Trade Credit, Workers' Compensation and Other Specialty. Other Specialty includes Contingency, Crisis Management and Life and A&H. For the Talbot segment, Specialty includes Accident & Health, Aviation (Direct & Treaty), Contingency, Financial Lines and Political Lines. Political lines includes War, Political Risk and Political Violence. For the AlphaCat segment, Specialty includes Agriculture, Composite and Workers' Compensation.

(c) Liability includes general liability, professional liability, products liability and miscellaneous malpractice.

29 of 41

Validus Holdings, Ltd.

Consolidated Losses and Loss Ratios by Segment

(Expressed in thousands of U.S. Dollars, except share and per share information)

	At or for the Three Months Ended
	December 31, 2016																		December 31, 2015
	Validus Re Segment			AlphaCat Segment			Talbot Segment			Western World			Eliminations			Total			Validus Re Segment			AlphaCat Segment			Talbot Segment			Western World			Eliminations			Total
Gross reserves at period beginning	$	1,147,282		$	37,144		$	1,324,669		$	588,845		$	(61,953	)	$	3,035,987		$	1,288,796		$	9,658		$	1,317,541		$	616,522		$	(60,232	)	$	3,172,285
Losses recoverable	(113,121		)	—			(304,216		)	(89,225		)	61,953			(444,609		)	(60,785		)	—			(298,836		)	(85,823		)	60,232			(385,212		)
Net reserves at period beginning	1,034,161			37,144			1,020,453			499,620			—			2,591,378			1,228,011			9,658			1,018,705			530,699			—			2,787,073
Incurred losses- current year	126,995			18,335			121,746			54,837			—			321,913			123,051			6,778			101,922			41,108			—			272,859
Change in prior accident years	(28,939		)	(1,129		)	(16,071		)	(648		)	—			(46,787		)	(22,566		)	(5,105		)	(23,112		)	(7,328		)	—			(58,111		)
Incurred losses	98,056			17,206			105,675			54,189			—			275,126			100,485			1,673			78,810			33,780			—			214,748
Foreign exchange	(14,497		)	(250		)	(9,561		)	—			—			(24,308		)	7,912			19			(5,210		)	—			—			2,721
Paid losses - current year	(58,791		)	(5,477		)	(67,536		)	(17,068		)	—			(148,872		)	(174,402		)	—			(34,107		)	(12,442		)	—			(220,951		)
Paid losses - prior years	(40,181		)	(89		)	(53,552		)	(34,728		)	—			(128,550		)	(51,192		)	(337		)	(49,225		)	(36,856		)	—			(137,610		)
Paid losses	(98,972		)	(5,566		)	(121,088		)	(51,796		)	—			(277,422		)	(225,594		)	(337		)	(83,332		)	(49,298		)	—			(358,561		)
Net reserves at period end	1,018,748			48,534			995,479			502,013			—			2,564,774			1,110,814			11,013			1,008,973			515,181			—			2,645,981
Losses recoverable	98,005			—			306,038			87,487			(61,109		)	430,421			36,055			—			293,662			85,150			(64,281		)	350,586
Gross reserves at period end	$	1,116,753		$	48,534		$	1,301,517		$	589,500		$	(61,109	)	$	2,995,195		$	1,146,869		$	11,013		$	1,302,635		$	600,331		$	(64,281	)	$	2,996,567
Net premiums earned	$	224,513		$	66,087		$	174,520		$	75,279					$	540,399		$	231,914		$	45,746		$	203,920		$	61,720					$	543,300
Current year loss ratio	56.6		%	27.7		%	69.8		%	72.9		%				59.6		%	53.0		%	14.8		%	49.9		%	66.6		%				50.2		%
Prior accident years adjustments	-12.9		%	-1.7		%	-9.2		%	-0.9		%				-8.7		%	-9.7		%	-11.1		%	-11.3		%	-11.9		%				-10.7		%
Net loss ratio	43.7		%	26.0		%	60.6		%	72.0		%				50.9		%	43.3		%	3.7		%	38.6		%	54.7		%				39.5		%
Paid to incurred	100.9		%	32.3		%	114.6		%	95.6		%				100.8		%	224.5		%	-20.1		%	105.7		%	145.9		%				167.0		%
	At or for the Years Ended
	December 31, 2016																		December 31, 2015
	Validus Re Segment			AlphaCat Segment			Talbot Segment			Western World			Eliminations			Total			Validus Re Segment			AlphaCat Segment			Talbot Segment			Western World			Eliminations			Total
Gross reserves at period beginning	$	1,146,869		$	11,013		$	1,302,635		$	600,331		$	(64,281	)	$	2,996,567		$	1,333,878		$	15,278		$	1,352,056		$	613,551		$	(71,616	)	$	3,243,147
Losses recoverable	(36,055		)	—			(293,662		)	(85,150		)	64,281			(350,586		)	(70,279		)	—			(290,581		)	(88,222		)	71,616			(377,466		)
Net reserves at period beginning	1,110,814			11,013			1,008,973			515,181			—			2,645,981			1,263,599			15,278			1,061,475			525,329			—			2,865,681
Incurred losses- current year	530,021			47,588			510,756			192,924			—			1,281,289			586,592			8,854			493,679			194,845			—			1,283,970
Change in prior accident years	(118,533		)	(2,737		)	(85,810		)	(9,112		)	—			(216,192		)	(128,616		)	(8,197		)	(146,357		)	(22,967		)	—			(306,137		)
Incurred losses	411,488			44,851			424,946			183,812			—			1,065,097			457,976			657			347,322			171,878			—			977,833
Foreign exchange	1,519			(436		)	(32,985		)	—			—			(31,902		)	(16,674		)	(5		)	(13,015		)	—			—			(29,694		)
Paid losses - current year	(192,527		)	(6,649		)	(146,742		)	(43,316		)	—			(389,234		)	(199,919		)	—			(90,007		)	(36,241		)	—			(326,167		)
Paid losses - prior years	(312,546		)	(245		)	(258,713		)	(153,664		)	—			(725,168		)	(394,168		)	(4,917		)	(296,802		)	(145,785		)	—			(841,672		)
Paid losses	(505,073		)	(6,894		)	(405,455		)	(196,980		)	—			(1,114,402		)	(594,087		)	(4,917		)	(386,809		)	(182,026		)	—			(1,167,839		)
Net reserves at period end	1,018,748			48,534			995,479			502,013			—			2,564,774			1,110,814			11,013			1,008,973			515,181			—			2,645,981
Losses recoverable	98,005			—			306,038			87,487			(61,109		)	430,421			36,055			—			293,662			85,150			(64,281		)	350,586
Gross reserves at period end	$	1,116,753		$	48,534		$	1,301,517		$	589,500		$	(61,109	)	$	2,995,195		$	1,146,869		$	11,013		$	1,302,635		$	600,331		$	(64,281	)	$	2,996,567
Net premiums earned	$	943,945		$	250,072		$	781,916		$	273,232					$	2,249,165		$	990,213		$	159,935		$	838,091		$	258,650					$	2,246,889
Current year loss ratio	56.2		%	19.0		%	65.3		%	70.6		%				57.0		%	59.2		%	5.5		%	58.9		%	75.3		%				57.1		%
Prior accident years adjustments	-12.6		%	-1.1		%	-11.0		%	-3.3		%				-9.6		%	-13.0		%	-5.1		%	-17.5		%	-8.9		%				-13.6		%
Net loss ratio	43.6		%	17.9		%	54.3		%	67.3		%				47.4		%	46.2		%	0.4		%	41.4		%	66.4		%				43.5		%
Paid to incurred	122.7		%	15.4		%	95.4		%	107.2		%				104.6		%	129.7		%	NM			111.4		%	105.9		%				119.4		%

30 of 41

Validus Holdings, Ltd.

Losses and Loss Ratios by Class of Business - Validus Re

(Expressed in thousands of U.S. Dollars, except share and per share information)

	At or for the Three Months Ended
	December 31, 2016												December 31, 2015
	Property			Marine			Specialty (a)			Total			Property			Marine			Specialty (a)			Total
Gross reserves at period beginning	$	503,273		$	365,444		$	278,565		$	1,147,282		$	574,926		$	331,284		$	382,586		$	1,288,796
Losses recoverable	(55,920		)	(53,463		)	(3,738		)	(113,121		)	(48,119		)	(8,262		)	(4,404		)	(60,785		)
Net reserves at period beginning	447,353			311,981			274,827			1,034,161			526,807			323,022			378,182			1,228,011
Incurred losses - current year	45,073			14,502			67,420			126,995			41,967			21,507			59,577			123,051
Change in prior accident years	(5,852		)	(9,468		)	(13,619		)	(28,939		)	(11,906		)	(10,235		)	(425		)	(22,566		)
Incurred losses	39,221			5,034			53,801			98,056			30,061			11,272			59,152			100,485
Foreign exchange	(11,660		)	(1,040		)	(1,797		)	(14,497		)	8,421			(263		)	(246		)	7,912
Paid losses - current year	(20,625		)	(3,662		)	(34,504		)	(58,791		)	(9,034		)	(983		)	(164,385		)	(174,402		)
Paid losses - prior years	(32,443		)	(8,978		)	1,240			(40,181		)	(23,160		)	(16,742		)	(11,290		)	(51,192		)
Paid losses	(53,068		)	(12,640		)	(33,264		)	(98,972		)	(32,194		)	(17,725		)	(175,675		)	(225,594		)
Net reserves at period end	421,846			303,335			293,567			1,018,748			533,095			316,306			261,413			1,110,814
Losses recoverable	42,873			52,970			2,162			98,005			23,109			8,993			3,953			36,055
Gross reserves at period end	$	464,719		$	356,305		$	295,729		$	1,116,753		$	556,204		$	325,299		$	265,366		$	1,146,869
Net premiums earned	$	97,744		$	24,047		$	102,722		$	224,513		$	107,510		$	34,326		$	90,078		$	231,914
Current year loss ratio	46.1		%	60.3		%	65.7		%	56.6		%	39.1		%	62.7		%	66.2		%	53.0		%
Prior accident years adjustments	-6.0		%	-39.4		%	-13.3		%	-12.9		%	-11.1		%	-29.8		%	-0.5		%	-9.7		%
Net loss ratio	40.1		%	20.9		%	52.4		%	43.7		%	28.0		%	32.9		%	65.7		%	43.3		%
Paid to incurred	135.3		%	251.1		%	61.8		%	100.9		%	107.1		%	157.2		%	297.0		%	224.5		%
	At or for the Years Ended
	December 31, 2016												December 31, 2015
	Property			Marine			Specialty (a)			Total			Property			Marine			Specialty (a)			Total
Gross reserves at period beginning	$	556,204		$	325,299		$	265,366		$	1,146,869		$	742,461		$	341,902		$	249,515		$	1,333,878
Losses recoverable	(23,109		)	(8,993		)	(3,953		)	(36,055		)	(62,159		)	(2,500		)	(5,620		)	(70,279		)
Net reserves at period beginning	533,095			316,306			261,413			1,110,814			680,302			339,402			243,895			1,263,599
Incurred losses - current year	155,747			70,030			304,244			530,021			156,575			130,766			299,251			586,592
Change in prior accident years	(57,888		)	(24,435		)	(36,210		)	(118,533		)	(70,343		)	(39,460		)	(18,813		)	(128,616		)
Incurred losses	97,859			45,595			268,034			411,488			86,232			91,306			280,438			457,976
Foreign exchange	3,634			(879		)	(1,236		)	1,519			(14,039		)	(1,486		)	(1,149		)	(16,674		)
Paid losses - current year	(27,648		)	(8,821		)	(156,058		)	(192,527		)	(16,854		)	(3,715		)	(179,350		)	(199,919		)
Paid losses - prior years	(185,094		)	(48,866		)	(78,586		)	(312,546		)	(202,546		)	(109,201		)	(82,421		)	(394,168		)
Paid losses	(212,742		)	(57,687		)	(234,644		)	(505,073		)	(219,400		)	(112,916		)	(261,771		)	(594,087		)
Net reserves at period end	421,846			303,335			293,567			1,018,748			533,095			316,306			261,413			1,110,814
Losses recoverable	42,873			52,970			2,162			98,005			23,109			8,993			3,953			36,055
Gross reserves at period end	$	464,719		$	356,305		$	295,729		$	1,116,753		$	556,204		$	325,299		$	265,366		$	1,146,869
Net premiums earned	$	398,818		$	111,172		$	433,955		$	943,945		$	431,126		$	147,565		$	411,522		$	990,213
Current year loss ratio	39.0		%	63.0		%	70.1		%	56.2		%	36.3		%	88.6		%	72.7		%	59.2		%
Prior accident years adjustments	-14.5		%	-22.0		%	-8.3		%	-12.6		%	-16.3		%	-26.7		%	-4.6		%	-13.0		%
Net loss ratio	24.5		%	41.0		%	61.8		%	43.6		%	20.0		%	61.9		%	68.1		%	46.2		%
Paid to incurred	217.4		%	126.5		%	87.5		%	122.7		%	254.4		%	123.7		%	93.3		%	129.7		%

Notes:

(a) For the Validus Re segment, the Specialty class includes Aerospace & Aviation, Agriculture, Casualty, Composite, Financial, Technical Lines, Terrorism, Trade Credit, Workers' Compensation and Other Specialty. Other Specialty includes Contingency, Crisis Management and Life and A&H.

31 of 41

Validus Holdings, Ltd.

Losses and Loss Ratios by Class of Business - Talbot

(Expressed in thousands of U.S. Dollars, except share and per share information)

	At or for the Three Months Ended
	December 31, 2016												December 31, 2015
	Property (a)			Marine			Specialty (a)			Total			Property (a)			Marine			Specialty (a)			Total
Gross reserves at period beginning	$	318,692		$	534,062		$	471,915		$	1,324,669		$	327,820		$	510,453		$	479,268		$	1,317,541
Losses recoverable	(89,398		)	(117,217		)	(97,601		)	(304,216		)	(108,153		)	(96,250		)	(94,433		)	(298,836		)
Net reserves at period beginning	229,294			416,845			374,314			1,020,453			219,667			414,203			384,835			1,018,705
Incurred losses - current year	53,427			34,280			34,039			121,746			27,163			38,683			36,076			101,922
Change in prior accident years	(7,399		)	(1,227		)	(7,445		)	(16,071		)	(5,252		)	(12,742		)	(5,118		)	(23,112		)
Incurred losses	46,028			33,053			26,594			105,675			21,911			25,941			30,958			78,810
Foreign exchange	(2,883		)	(2,925		)	(3,753		)	(9,561		)	(1,032		)	(1,654		)	(2,524		)	(5,210		)
Paid losses - current year	(22,763		)	(27,942		)	(16,831		)	(67,536		)	(11,085		)	(11,636		)	(11,386		)	(34,107		)
Paid losses - prior years	(8,925		)	(14,908		)	(29,719		)	(53,552		)	(10,437		)	(20,871		)	(17,917		)	(49,225		)
Paid losses	(31,688		)	(42,850		)	(46,550		)	(121,088		)	(21,522		)	(32,507		)	(29,303		)	(83,332		)
Net reserves at period end	240,751			404,123			350,605			995,479			219,024			405,983			383,966			1,008,973
Losses recoverable	93,774			125,677			86,587			306,038			109,502			95,494			88,666			293,662
Gross reserves at period end	$	334,525		$	529,800		$	437,192		$	1,301,517		$	328,526		$	501,477		$	472,632		$	1,302,635
Net premiums earned	$	54,730		$	52,191		$	67,599		$	174,520		$	54,803		$	72,919		$	76,198		$	203,920
Current year loss ratio	97.6		%	65.7		%	50.3		%	69.8		%	49.6		%	53.1		%	47.3		%	49.9		%
Prior accident years adjustments	-13.5		%	-2.4		%	-11.0		%	-9.2		%	-9.6		%	-17.5		%	-6.7		%	-11.3		%
Net loss ratio	84.1		%	63.3		%	39.3		%	60.6		%	40.0		%	35.6		%	40.6		%	38.6		%
Paid to incurred	68.8		%	129.6		%	175.0		%	114.6		%	98.2		%	125.3		%	94.7		%	105.7		%
	At or for the Years Ended
	December 31, 2016												December 31, 2015
	Property (a)			Marine			Specialty (a)			Total			Property (a)			Marine			Specialty (a)			Total
Gross reserves at period beginning	$	328,526		$	501,477		$	472,632		$	1,302,635		$	385,370		$	497,895		$	468,791		$	1,352,056
Losses recoverable	(109,502		)	(95,494		)	(88,666		)	(293,662		)	(142,679		)	(76,205		)	(71,697		)	(290,581		)
Net reserves at period beginning	219,024			405,983			383,966			1,008,973			242,691			421,690			397,094			1,061,475
Incurred losses - current year	181,037			158,896			170,823			510,756			139,200			194,441			160,038			493,679
Change in prior accident years	(38,368		)	(11,738		)	(35,704		)	(85,810		)	(52,393		)	(63,920		)	(30,044		)	(146,357		)
Incurred losses	142,669			147,158			135,119			424,946			86,807			130,521			129,994			347,322
Foreign exchange	(6,829		)	(10,269		)	(15,887		)	(32,985		)	(2,909		)	(4,188		)	(5,918		)	(13,015		)
Paid losses - current year	(49,044		)	(53,710		)	(43,988		)	(146,742		)	(25,682		)	(27,184		)	(37,141		)	(90,007		)
Paid losses - prior years	(65,069		)	(85,039		)	(108,605		)	(258,713		)	(81,883		)	(114,856		)	(100,063		)	(296,802		)
Paid losses	(114,113		)	(138,749		)	(152,593		)	(405,455		)	(107,565		)	(142,040		)	(137,204		)	(386,809		)
Net reserves at period end	240,751			404,123			350,605			995,479			219,024			405,983			383,966			1,008,973
Losses recoverable	93,774			125,677			86,587			306,038			109,502			95,494			88,666			293,662
Gross reserves at period end	$	334,525		$	529,800		$	437,192		$	1,301,517		$	328,526		$	501,477		$	472,632		$	1,302,635
Net premiums earned	$	227,854		$	260,220		$	293,842		$	781,916		$	221,303		$	318,958		$	297,830		$	838,091
Current year loss ratio	79.4		%	61.1		%	58.2		%	65.3		%	62.9		%	60.9		%	53.7		%	58.9		%
Prior accident years adjustments	-16.8		%	-4.5		%	-12.2		%	-11.0		%	-23.7		%	-20.0		%	-10.1		%	-17.5		%
Net loss ratio	62.6		%	56.6		%	46.0		%	54.3		%	39.2		%	40.9		%	43.6		%	41.4		%
Paid to incurred	80.0		%	94.3		%	112.9		%	95.4		%	123.9		%	108.8		%	105.5		%	111.4		%

Notes:

(a) For the Talbot segment, the Property class includes Downstream Energy and Power. The Specialty class includes Accident & Health, Aviation (Direct & Treaty), Contingency, Financial Lines and Political Lines. Political Lines includes War, Political Risk and Political Violence.

32 of 41

Validus Holdings, Ltd.

Losses and Loss Ratios by Class of Business - Western World

(Expressed in thousands of U.S. Dollars, except share and per share information)

	At or for the Three Months Ended
	December 31, 2016									December 31, 2015
	Property			Liability (a)			Total			Property			Liability (a)			Total
Gross reserves at period beginning	$	15,743		$	573,102		$	588,845		$	14,436		$	602,086		$	616,522
Losses recoverable	(2,686		)	(86,539		)	(89,225		)	(383		)	(85,440		)	(85,823		)
Net reserves at period beginning	13,057			486,563			499,620			14,053			516,646			530,699
Incurred losses- current year	16,759			38,078			54,837			4,184			36,924			41,108
Change in prior accident years	(125		)	(523		)	(648		)	(1,397		)	(5,931		)	(7,328		)
Incurred losses	16,634			37,555			54,189			2,787			30,993			33,780
Paid losses - current year	(10,253		)	(6,815		)	(17,068		)	(4,252		)	(8,190		)	(12,442		)
Paid losses - prior years	(282		)	(34,446		)	(34,728		)	(143		)	(36,713		)	(36,856		)
Paid losses	(10,535		)	(41,261		)	(51,796		)	(4,395		)	(44,903		)	(49,298		)
Net reserves at period end	19,156			482,857			502,013			12,445			502,736			515,181
Losses recoverable	187			87,300			87,487			63			85,087			85,150
Gross reserves at period end	$	19,343		$	570,157		$	589,500		$	12,508		$	587,823		$	600,331
Net premiums earned	$	20,084		$	55,195		$	75,279		$	11,578		$	50,142		$	61,720
Current year loss ratio	83.4		%	68.9		%	72.9		%	36.2		%	73.6		%	66.6		%
Prior accident years adjustments	-0.6		%	-0.9		%	-0.9		%	-12.1		%	-11.8		%	-11.9		%
Net loss ratio	82.8		%	68.0		%	72.0		%	24.1		%	61.8		%	54.7		%
Paid to incurred	63.3		%	109.9		%	95.6		%	157.7		%	144.9		%	145.9		%
	At or for the Years Ended
	December 31, 2016									December 31, 2015
	Property			Liability (a)			Total			Property			Liability (a)			Total
Gross reserves at period beginning	$	12,508		$	587,823		$	600,331		$	20,303		$	593,248		$	613,551
Losses recoverable	(63		)	(85,087		)	(85,150		)	(4,704		)	(83,518		)	(88,222		)
Net reserves at period beginning	12,445			502,736			515,181			15,599			509,730			525,329
Incurred losses- current year	48,170			144,754			192,924			29,149			165,696			194,845
Change in prior accident years	(2,701		)	(6,411		)	(9,112		)	(6,045		)	(16,922		)	(22,967		)
Incurred losses	45,469			138,343			183,812			23,104			148,774			171,878
Paid losses - current year	(31,000		)	(12,316		)	(43,316		)	(19,965		)	(16,276		)	(36,241		)
Paid losses - prior years	(7,758		)	(145,906		)	(153,664		)	(6,293		)	(139,492		)	(145,785		)
Paid losses	(38,758		)	(158,222		)	(196,980		)	(26,258		)	(155,768		)	(182,026		)
Net reserves at period end	19,156			482,857			502,013			12,445			502,736			515,181
Losses recoverable	187			87,300			87,487			63			85,087			85,150
Gross reserves at period end	$	19,343		$	570,157		$	589,500		$	12,508		$	587,823		$	600,331
Net premiums earned	$	63,154		$	210,078		$	273,232		$	44,083		$	214,567		$	258,650
Current year loss ratio	76.3		%	69.0		%	70.6		%	66.1		%	77.2		%	75.3		%
Prior accident years adjustments	-4.3		%	-3.1		%	-3.3		%	-13.7		%	-7.9		%	-8.9		%
Net loss ratio	72.0		%	65.9		%	67.3		%	52.4		%	69.3		%	66.4		%
Paid to incurred	85.2		%	114.4		%	107.2		%	113.7		%	104.7		%	105.9		%

Notes:

(a) For the Western World segment, the Liability class includes general liability, professional liability, products liability and miscellaneous malpractice.

33 of 41

Validus Holdings, Ltd.

Analysis of Loss Ratios by Segment

(Expressed in thousands of U.S. Dollars, except share and per share information)

	Three Months Ended										Years Ended
	December 31, 2016		September 30, 2016		June 30, 2016		March 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015
Validus Re Segment
Current period - excluding items below	47.5	%	53.1	%	45.7	%	44.5	%	52.9	%	47.6	%	50.1	%
Current period - notable loss events	9.1	%	0.0	%	7.2	%	0.0	%	0.1	%	4.1	%	7.3	%
Current period - non-notable loss events	0.0	%	4.5	%	13.1	%	0.0	%	0.0	%	4.5	%	1.8	%
Change in prior accident years	(12.9	)%	(14.5	)%	(12.5	)%	(10.5	)%	(9.7	)%	(12.6	)%	(13.0	)%
Net loss ratio	43.7	%	43.1	%	53.5	%	34.0	%	43.3	%	43.6	%	46.2	%
AlphaCat Segment
Current period - excluding items below	3.3	%	5.6	%	14.2	%	4.6	%	14.8	%	6.8	%	5.5	%
Current period - notable loss events	24.2	%	1.5	%	12.3	%	0.0	%	0.0	%	9.7	%	0.0	%
Current period - non-notable loss events	0.2	%	0.0	%	10.3	%	0.0	%	0.0	%	2.5	%	0.0	%
Change in prior accident years	(1.7	)%	(0.4	)%	(0.7	)%	(1.5	)%	(11.1	)%	(1.1	)%	(5.1	)%
Net loss ratio	26.0	%	6.7	%	36.1	%	3.1	%	3.7	%	17.9	%	0.4	%
Talbot Segment
Current period - excluding items below	62.6	%	58.9	%	58.0	%	59.4	%	50.1	%	59.6	%	55.4	%
Current period - notable loss events	7.1	%	0.0	%	5.8	%	0.0	%	(0.2	)%	3.1	%	2.9	%
Current period - non-notable loss events	0.1	%	5.7	%	4.5	%	0.0	%	0.0	%	2.6	%	0.6	%
Change in prior accident years	(9.2	)%	(9.4	)%	(14.1	)%	(11.0	)%	(11.3	)%	(11.0	)%	(17.5	)%
Net loss ratio	60.6	%	55.2	%	54.2	%	48.4	%	38.6	%	54.3	%	41.4	%
Western World Segment
Current period - excluding items below	68.3	%	65.8	%	71.2	%	71.7	%	66.6	%	69.1	%	75.3	%
Current period - notable loss events	4.5	%	0.0	%	0.0	%	0.0	%	0.0	%	1.2	%	0.0	%
Current period - non-notable loss events	0.1	%	0.0	%	1.0	%	0.0	%	0.0	%	0.3	%	0.0	%
Change in prior accident years	(0.9	)%	(1.2	)%	(4.8	)%	(7.2	)%	(11.9	)%	(3.3	)%	(8.9	)%
Net loss ratio	72.0	%	64.6	%	67.4	%	64.5	%	54.7	%	67.3	%	66.4	%
Consolidated
Current period - excluding items below	49.8	%	51.2	%	49.6	%	48.7	%	50.2	%	49.9	%	51.8	%
Current period - notable loss events	9.7	%	0.2	%	6.4	%	0.0	%	0.0	%	4.0	%	4.3	%
Current period - non-notable loss events	0.1	%	3.8	%	8.4	%	0.0	%	0.0	%	3.1	%	1.0	%
Change in prior accident years	(8.7	)%	(9.4	)%	(10.9	)%	(9.4	)%	(10.7	)%	(9.6	)%	(13.6	)%
Net loss ratio	50.9	%	45.8	%	53.5	%	39.3	%	39.5	%	47.4	%	43.5	%

Notes:

For disclosure purposes, only those loss events which aggregate to over $30.0 million on a consolidated basis (“notable loss events”) are disclosed separately in the Company’s analysis of loss ratios and also included in the reserve for notable loss events and reserve for development on notable loss events table in the Company’s Annual Report on Form 10-K.  In addition, loss events which aggregate to over $15.0 million but less than $30.0 million on a consolidated basis (“non-notable loss events") are incorporated into the Company’s analysis of loss ratios. Net losses and loss expenses are net of reinsurance but not net of reinstatement premiums.

34 of 41

Validus Holdings, Ltd.

Consolidated Reinsurance Recoverable Analysis

(Expressed in thousands of U.S. Dollars, except share and per share information)

Consolidated Reinsurance Recoverable at December 31, 2016
Categories	Reinsurance Recoverable (a)		%		Top 10 Reinsurers	Rating (b)	Reinsurance Recoverable (a)		%
Top 10 reinsurers	$	395,308	84.9	%	Lloyd's Syndicates	A+	$	84,419	18.2	%
Other reinsurers' balances > $1 million	66,944		14.4	%	Swiss Re	AA-	84,044		18.1	%
Other reinsurers' balances < $1 million	3,416		0.7	%	Fully collateralized reinsurers	NR	83,088		17.8	%
Total	$	465,668	100.0	%	Hannover Re	AA-	50,603		10.9	%
					Everest Re	A+	36,912		7.9	%
					Munich Re	AA-	18,214		3.9	%
					Transatlantic Re	A+	10,593		2.3	%
					Hamilton Re	A-	10,343		2.2	%
					Toa Re	A+	9,510		2.0	%
					National Indemnity Company	AA+	7,582		1.6	%
					Total		$	395,308	84.9	%
Consolidated Reinsurance Recoverable at December 31, 2015
Categories	Reinsurance Recoverable (a)		%		Top 10 Reinsurers	Rating (b)	Reinsurance Recoverable (a)		%
Top 10 reinsurers	$	303,108	81.1	%	Swiss Re	AA-	$	83,048	22.2	%
Other reinsurers' balances > $1 million	61,222		16.4	%	Lloyd's Syndicates	A+	66,356		17.8	%
Other reinsurers' balances < $1 million	9,327		2.5	%	Hannover Re	AA-	43,765		11.7	%
Total	$	373,657	100.0	%	Everest Re	A+	43,060		11.5	%
					Munich Re	AA-	18,707		5.0	%
					Transatlantic Re	A+	11,923		3.2	%
					Hamilton Re	A-	10,898		2.9	%
					National Indemnity Company	AA+	10,293		2.8	%
					XL Re	A+	8,728		2.3	%
					Toa Re	A+	6,330		1.7	%
					Total		$	303,108	81.1	%

Notes:

(a) Reinsurance Recoverable includes Loss Reserves Recoverable and Paid Losses Recoverable.

(b) 99.1% of Reinsurance Recoverable at December 31, 2016 were from reinsurers rated A- or better by internationally recognized rating agencies or were fully collateralized.

35 of 41

Validus Holdings, Ltd.

Consolidated Investment Portfolio Composition and Net Investment Income

(Expressed in thousands of U.S. Dollars, except share and per share information)

Investment portfolio	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015
Managed investments, cash and cash equivalents and restricted cash
U.S. Government and Government Agency	$	804,126		$	837,546		$	931,803		$	910,319		$	937,202
Non-U.S. Government and Government Agency	240,791			248,390			215,250			222,085			237,968
States, municipalities, political subdivision	271,830			283,361			285,412			293,622			301,289
Agency residential mortgage-backed securities	679,595			657,876			676,783			663,939			610,582
Non-Agency residential mortgage-backed securities	15,477			20,615			23,389			25,350			26,920
U.S. corporate	1,534,508			1,526,677			1,556,047			1,506,619			1,489,951
Non-U.S. corporate	410,227			431,632			364,406			395,056			446,570
Bank loans	570,399			587,537			597,062			603,427			576,211
Asset-backed securities	526,814			485,519			429,340			406,827			437,124
Commercial mortgage-backed securities	330,932			340,797			314,033			276,941			260,135
Total fixed maturities	5,384,699			5,419,950			5,393,525			5,304,185			5,323,952
Total short-term investments	228,386			197,803			189,628			195,286			237,369
Total other investments	405,712			394,695			359,526			344,151			336,856
Investment in investment affiliates	100,431			99,731			99,278			84,135			87,673
Cash and cash equivalents	415,419			439,192			500,000			525,219			537,636
Restricted cash	15,000			9,970			1,663			—			—
Total managed investments, cash and cash equivalents and restricted cash (a)	6,549,647			6,561,341			6,543,620			6,452,976			6,523,486
Non-managed investments, cash and cash equivalents and restricted cash
Catastrophe bonds	158,331			156,391			158,061			177,119			186,379
Short-term investments	2,567,784			2,283,603			2,180,026			1,912,913			1,704,266
Cash and cash equivalents	4,557			4,800			68,798			44,555			185,473
Restricted cash	55,956			103,078			94,359			108,395			73,270
Total non-managed investments, cash and cash equivalents and restricted cash (a)	2,786,628			2,547,872			2,501,244			2,242,982			2,149,388
Total investments, cash and cash equivalents and restricted cash	$	9,336,275		$	9,109,213		$	9,044,864		$	8,695,958		$	8,672,874
	Three Months Ended															Years Ended
Net investment income	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015
Managed investments (a)
Fixed maturities and short-term investments	$	29,875		$	30,572		$	30,621		$	28,017		$	29,900		$	119,085		$	113,627
Other investments	7,194			11,768			8,026			872			1,019			27,860			13,307
Cash and cash equivalents and restricted cash	803			891			380			865			732			2,939			1,911
Securities lending income	16			22			12			5			3			55			16
Total gross investment income	37,888			43,253			39,039			29,759			31,654			149,939			128,861
Investment expenses	(2,013		)	(2,182		)	(2,190		)	(1,836		)	(1,769		)	(8,221		)	(7,695		)
Total managed net investment income	$	35,875		$	41,071		$	36,849		$	27,923		$	29,885		$	141,718		$	121,166
Annualized effective investment yield - managed investments (b)	2.25		%	2.58		%	2.34		%	1.79		%	1.90		%	2.24		%	1.91		%
Non-managed investments
Fixed maturities and short-term investments	$	1,689		$	1,970		$	1,977		$	1,295		$	1,677		$	6,931		$	6,528
Cash and cash equivalents and restricted cash	589			473			431			243			50			1,736			130
Total non-managed net investment income	2,278			2,443			2,408			1,538			1,727			8,667			6,658
Total net investment income	$	38,153		$	43,514		$	39,257		$	29,461		$	31,612		$	150,385		$	127,824

Notes:

(a) Managed investments represent assets governed by the Company’s investment policy statement (“IPS”) whereas, non-managed investments represent assets held in support of consolidated AlphaCat variable interest entities which are not governed by the Company’s IPS.

(b) Annualized investment yield is calculated by dividing net investment income by the average balance of the yield bearing assets managed by our portfolio managers (including funds of high grade structured products which are included in other investments, but excluding all other investments). Average assets for the three months ended is the average of the beginning and ending quarter end asset balances. Average assets for the year ended is the average of the beginning, ending and intervening quarter end asset balances. Percentages for the quarter periods are annualized.

36 of 41

Validus Holdings, Ltd.

Consolidated Fixed Maturity Portfolio Credit Quality and Maturity Profile

(Expressed in thousands of U.S. Dollars, except share and per share information)

	December 31, 2016				December 31, 2015
Fixed maturities - Credit Quality	Fair Value		%		Fair Value		%
Managed fixed maturities:
AAA	$	2,405,597	43.4	%	$	2,367,642	43.0	%
AA	538,289		9.7	%	569,386		10.3	%
A	1,081,949		19.5	%	1,031,326		18.7	%
BBB	740,861		13.4	%	691,538		12.6	%
Total investment grade managed fixed maturities	4,766,696		86.0	%	4,659,892		84.6	%
BB	213,568		3.9	%	235,724		4.3	%
B	177,737		3.2	%	179,069		3.2	%
CCC	13,371		0.2	%	5,706		0.1	%
CC	—		0.0	%	1,015		0.0	%
NR	213,327		3.8	%	242,546		4.4	%
Total non-investment grade managed fixed maturities	618,003		11.1	%	664,060		12.0	%
Total managed fixed maturities	$	5,384,699	97.1	%	$	5,323,952	96.6	%
Non-managed fixed maturities:
BBB	—		0.0	%	1,911		0.0	%
Total investment grade non-managed catastrophe bonds	—		0.0	%	1,911		0.0	%
BB	29,731		0.6	%	70,962		1.3	%
B	4,524		0.1	%	30,698		0.6	%
NR	124,076		2.2	%	82,808		1.5	%
Total non-investment grade non-managed catastrophe bonds	158,331		2.9	%	184,468		3.4	%
Total non-managed fixed maturities	$	158,331	2.9	%	$	186,379	3.4	%
Total fixed maturities	$	5,543,030	100.0	%	$	5,510,331	100.0	%
	December 31, 2016				December 31, 2015
Fixed maturities - Maturity Profile	Fair Value		%		Fair Value		%
Managed investments
Due in one year or less	$	346,161	6.2	%	$	366,019	6.6	%
Due after one year through five years	2,933,146		52.9	%	2,936,053		53.3	%
Due after five years through ten years	426,647		7.7	%	539,083		9.8	%
Due after ten years	125,927		2.3	%	148,036		2.7	%
	3,831,881		69.1	%	3,989,191		72.4	%
Asset-backed and mortgage backed securities	1,552,818		28.0	%	1,334,761		24.2	%
Total managed fixed maturities	5,384,699		97.1	%	5,323,952		96.6	%
Non-managed catastrophe bonds
Due in one year or less	45,418		0.8	%	7,544		0.1	%
Due after one year through five years	111,656		2.1	%	163,575		3.0	%
Due after five years through ten years	1,257		0.0	%	15,260		0.3	%
Due after ten years	—		0.0	%	—		0.0	%
Total non-managed fixed maturities	158,331		2.9	%	186,379		3.4	%
Total fixed maturities	$	5,543,030	100.0	%	$	5,510,331	100.0	%

37 of 41

Validus Holdings, Ltd.

Top Ten Exposures to Fixed Income Corporate Issuers

(Expressed in thousands of U.S. Dollars, except share and per share information)

	December 31, 2016
Issuer (a)	Fair Value (b)		S&P Rating (c)	% of Managed Investments, Cash and Cash Equivalents
JPMorgan Chase & Co	$	66,827	BBB+	1.0	%
Citigroup Inc	52,737		BBB	0.8	%
Bank of America Corp	50,280		BBB+	0.8	%
Morgan Stanley	48,273		BBB+	0.7	%
Goldman Sachs Group	46,261		BBB+	0.7	%
Wells Fargo & Company	44,596		A	0.7	%
Anheuser-Busch Inbev NV	39,674		A-	0.6	%
Bank of New York Mellon Corp	34,619		A	0.5	%
HSBC Holdings plc	29,411		A	0.4	%
US Bancorp	28,175		AA-	0.4	%
Total	$	440,853		6.6	%

Notes:

(a) Issuers exclude government-backed, government-sponsored enterprises and cash and cash equivalents.

(b) Credit exposures represent only direct exposure to fixed maturities and short-term investments of the parent issuer and its major subsidiaries. These exposures exclude asset and mortgage backed securities that were issued, sponsored or serviced by the parent.

(c) Investment ratings are the median of Moody's, Standard & Poor's and Fitch, presented in Standard & Poor's equivalent rating. For investments where three ratings are unavailable, the lower of the ratings shall apply, presented in Standard & Poor's equivalent rating.

38 of 41

Validus Holdings, Ltd.

Capitalization

(Expressed in thousands of U.S. Dollars, except share and per share information)

Capitalization	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016			December 31, 2015
Senior Notes (a)	$	245,362		$	245,311		$	245,261		$	245,211		$	245,161
Junior Subordinated Deferrable Debentures (JSDs) (b)	289,800			289,800			289,800			289,800			289,800
Flagstone Junior Subordinated Deferrable Debentures (JSDs) (c)	247,426			248,368			248,187			248,535			247,868
Total debt	$	782,588		$	783,479		$	783,248		$	783,546		$	782,829
Redeemable noncontrolling interest	$	1,528,001		$	1,559,580		$	1,532,283		$	1,409,037		$	1,111,714
Preferred shares, liquidation value (d)	$	150,000		$	150,000		$	150,000		$	—		$	—
Ordinary shares, capital and surplus available to Validus common shareholders	3,711,507			3,738,712			3,734,438			3,739,864			3,651,544
Accumulated other comprehensive (loss)	(23,216		)	(21,092		)	(18,182		)	(15,438		)	(12,569		)
Noncontrolling interest	165,977			222,996			212,154			157,223			154,662
Total shareholders' equity	$	4,004,268		$	4,090,616		$	4,078,410		$	3,881,649		$	3,793,637
Total capitalization (e)	$	6,314,857		$	6,433,675		$	6,393,941		$	6,074,232		$	5,688,180
Total capitalization available to Validus (f)	$	4,620,879		$	4,651,099		$	4,649,504		$	4,507,972		$	4,421,804
Debt to total capitalization	12.4		%	12.2		%	12.2		%	12.9		%	13.8		%
Debt (excluding JSDs) to total capitalization	3.9		%	3.8		%	3.8		%	4.0		%	4.3		%
Debt to total capitalization available to Validus	16.9		%	16.8		%	16.8		%	17.4		%	17.7		%
Debt (excluding JSDs) to total capitalization available to Validus	5.3		%	5.3		%	5.3		%	5.4		%	5.5		%

Notes:

(a) On January 21, 2010, the Company offered and sold $250,000 of Senior Notes due 2040 (the “2010 Senior Notes”) in a registered public offering. The 2010 Senior Notes mature on January 26, 2040, and are redeemable at the Company’s option in whole any time or in part from time to time at a make-whole redemption price. Interest on the 2010 Senior Notes is payable at 8.875% per annum through January 26, 2040. Interest on the Notes is payable semi-annually in arrears on January 26 and July 26 of each year, commencing on July 26, 2010. The net proceeds of $244.0 million from the sale of the 2010 Senior Notes, after the deduction of commissions paid to the underwriters in the transaction and other expenses, was used by the Company for general corporate purposes, which included the repurchase of our outstanding capital stock and dividends to our shareholders.

(b) $150.0 million of Junior Subordinated Deferrable Debentures ( the "2006 Junior Subordinated Deferrable Debentures") were issued on June 15, 2006, mature on June 15, 2036, are redeemable at the Company's option at par beginning June 15, 2011, and require quarterly interest payments at a rate of 9.069% per annum through June 15, 2011 and thereafter at a floating rate of three-month LIBOR plus 355 basis points, reset quarterly. $200.0 million of Junior Subordinated Deferrable Debentures ("2007 Junior Subordinated Deferrable Debentures") were issued on June 21, 2007, mature on June 15, 2037, are redeemable at the Company's option at par beginning June 15, 2012, and require quarterly interest payments at a rate of 8.480% per annum through June 15, 2012, and thereafter at a floating rate of three-month LIBOR plus 295 basis points, reset quarterly. During 2008 and 2009, the Company repurchased $60.2 million principal amount of its 2007 Junior Subordinated Deferrable Debentures due 2037 from an unaffiliated financial institution.

(c) As part of the acquisition of Flagstone Reinsurance Holdings, S.A., the Company assumed $137.2 million of junior subordinated deferrable interest debentures due 2036 (the “Flagstone 2006 Junior Subordinated Deferrable Debentures”). The Flagstone 2006 Junior Subordinated Deferrable Debentures mature on September 15, 2036, are redeemable at the Company's option at par beginning September 15, 2011, and require quarterly interest payments by the Company to the holders of the Flagstone 2006 Junior Subordinated Deferrable Debentures. Interest is payable at a floating rate of three-month LIBOR plus 354 basis points, reset quarterly.

In addition, the Company assumed $113.7 million of junior subordinated deferrable interest debentures due 2037 (the “Flagstone 2007 Junior Subordinated Deferrable Debentures”). $88.8 million of the Flagstone 2007 Junior Subordinated Deferrable Debentures mature on July 30, 2037, are redeemable at the Company's option at par beginning July 30, 2012, and require quarterly interest payments by the Company to the holders of the Flagstone 2007 Junior Subordinated Deferrable Debentures. Interest is payable at a floating rate of three-month LIBOR plus 300 basis points, reset quarterly. $25.0 million of the Flagstone 2007 Junior Subordinated Deferrable Debentures mature on September 15, 2037, are redeemable at the Company's option at par beginning September 15, 2012, and require quarterly interest payments by the Company to the holders of the Flagstone 2007 Junior Subordinated Deferrable Debentures. Interest is payable at a floating rate of three-month LIBOR plus 310 basis points, reset quarterly.

(d) On June 13, 2016, the Company issued 6,000 shares of its 5.875% Non-Cumulative Preferred Shares, Series A (the "Series A Preferred Shares") (equivalent to 6,000,000 Depositary Shares, each of which represents a 1/1,000th interest in a Series A Preferred Share), $0.175 par value and $25,000 liquidation preference per share (equivalent to $25 per Depositary Share) at a price to the public of $25,000 per share (equivalent to $25 per Depositary Share). After underwriting discounts and expenses, the Company received net proceeds of $144.9 million. The Depositary Shares, representing the Series A Preferred Shares, are traded on the New York Stock Exchange (“NYSE”) under the symbol “VRPRA.” The Series A Preferred Shares have no stated maturity date and are redeemable, in whole or in part, at the Company’s option on and after June 15, 2021, at a redemption price of $25,000 per Series A Preferred Share (equivalent to $25 per Depositary Share), plus declared and unpaid dividends. Under certain circumstances, the Company may also redeem the Series A Preferred Shares in whole or in part before the redemption date. Dividends on the Series A Preferred Shares are non-cumulative and will accrue and be payable quarterly in arrears at an annual rate of 5.875% when declared by the Company’s Board of Directors.

(e) Total capitalization equals total shareholders' equity plus redeemable noncontrolling interest, Senior Notes and Junior Subordinated Deferrable Debentures.

(f) Total capitalization available to Validus equals total shareholders' equity less noncontrolling interests plus Senior Notes and Junior Subordinated Deferrable Debentures.

39 of 41

Validus Holdings, Ltd.

Estimated Exposures to Peak Zone Property Catastrophe Losses - As of January 1, 2017

(Expressed in thousands of U.S. Dollars, except share and per share information)

Probable Maximum Losses by Zone and Peril

		Consolidated (Validus Re, Talbot and Western World) Estimated Net Loss
Zones	Perils	20 year return period		50 year return period		100 year return period		250 year return period		Validus Re Net Maximum Zonal Aggregate
United States	Hurricane	$	270,984	$	458,487	$	713,318	$	1,011,620	$	1,912,290
California	Earthquake	72,099		224,160		286,832		393,169		1,675,329
Europe	Windstorm	85,226		195,632		246,674		431,449		1,262,636
Japan	Earthquake	56,515		117,040		202,194		256,951		748,965
Japan	Typhoon	60,229		123,010		210,015		256,207		704,006

Net loss estimates and zonal aggregates are before income tax, net of reinstatement premiums, and net of reinsurance and retrocessional recoveries. The estimates set forth above are based on an Occurrence basis on assumptions that are inherently subject to significant uncertainties and contingencies. These uncertainties and contingencies can affect actual losses and could cause actual losses to differ materially from those expressed above. In particular, modeled loss estimates do not necessarily accurately predict actual losses, and may significantly mis-estimate actual losses. Such estimates, therefore, should not be considered as a representation of actual losses.

The Company has developed the estimates of losses expected from certain catastrophes for its portfolio of property, marine, workers’ compensation, and personal accident contracts using commercially available catastrophe models such as RMS, AIR and EQECAT, which are applied and adjusted by the Company. These estimates include assumptions regarding the location, size and magnitude of an event, the frequency of events, the construction type and damageability of property in a zone, policy terms and conditions and the cost of rebuilding property in a zone, among other assumptions. These assumptions will evolve following any actual event. Accordingly, if the estimates and assumptions that are entered into the risk model are incorrect, or if the risk model proves to be an inaccurate forecasting tool, the losses the Company might incur from an actual catastrophe could be materially higher than its expectation of losses generated from modeled catastrophe scenarios. In addition, many risks such as second-event covers, aggregate excess of loss, or attritional loss components cannot be fully evaluated using the vendor models. Further, the Company cannot assure that such third party models are free of defects in the modeling logic or in the software code.

Investors should not rely on the information set forth in this presentation when considering investment in the Company. The information contained in this presentation has not been audited nor has it been subject to independent verification. The estimates set forth above speak only as of the date of this presentation and the Company undertakes no obligation to update or revise such information to reflect the occurrence of future events, including, but not limited to, the composition of the Company's business. The events presented reflect a specific set of prescribed calculations and do not necessarily reflect all events that may impact the Company.

Notes:

(a) Validus Re net maximum zonal aggregate includes Validus share of AlphaCat limits, excludes Western World and the limits supported by the Funds at Lloyds ("FAL") provided by Validus Re.

40 of 41

Validus Holdings, Ltd.

Estimated Exposures to Specified Loss Scenarios - As of July 1, 2016

(Expressed in millions of U.S. Dollars, except share and per share information)

Consolidated (Validus Re, Talbot and Western World) Realistic Disaster Scenarios (RDS)

Type	Catastrophe Scenarios		Estimated Consolidated (Validus Re, Talbot and Western World) Net Loss		% of latest 12 Months Consolidated Net Premiums Earned
Marine	Loss of major complex	Total loss to all platforms and bridge links of a major oil complex	$	197.5	8.8	%
Marine	Major cruise vessel incident	US-owned cruise vessel sunk or severely damaged	131.7		5.9	%
Marine	Marine collision	Fully laden tanker collides with a cruise vessel in US waters	91.1		4.1	%
Political Risks	South East Asia	Chinese economy has a "hard landing" with sharp fall in growth rates; regional contagion	118.9		5.3	%
Political Risks	Russia	The Russian corporate sector struggles to deal with the effects of crashing commodity and stock prices	56.5		2.5	%
Political Risks	Turkey	Severe economic crisis in Turkey due to political upheaval	54.7		2.4	%
Political Risks	Nigeria	Severe economic, political and social crisis in Nigeria leads to widespread civil unrest	42.3		1.9	%
Political Risks	Middle East	US and Iran escalate into military confrontation; regional contagion	27.6		1.2	%
Aviation	Aviation collision	Collision of two aircraft over a major city	94.1		4.2	%
Satellite	Solar flare	Large single or sequence of proton flares results in loss to all satellites in synchronous orbit	45.2		2.0	%
Satellite	Generic defect	Undetected defect in a number of operational satellites causing major loss	23.7		1.1	%
Terrorism	Rockefeller Center	Midtown Manhattan suffers a 2-tonne conventional bomb blast	68.4		3.0	%
Terrorism	Exchange Place	Lower Manhattan suffers a 2-tonne conventional bomb blast	40.8		1.8	%
Liability	Professional lines	Failure or collapse of a major corporation	37.2		1.7	%
Liability	Professional lines	UK pensions mis-selling	16.3		0.7	%
Cyber	Major data security breach	Simultaneous cyber-attacks on organizations within one industrial sector; loss of customer data	26.8		1.2	%

The Company has presented the Company Realistic Disaster Scenarios for non-natural catastrophe events. Twice yearly, Lloyd's syndicates' including the Company's Talbot Syndicate 1183 are required to provide details of their potential exposures to specific disaster scenarios. Lloyd’s makes its updated Realistic Disaster Scenarios (RDS) guidance available to the market annually. The RDS scenario specification document for 2016 can be accessed at the RDS part of the Lloyd's public website: http://www.lloyds.com/the-market/tools-and-resources/research/exposure-management/realistic-disaster-scenarios.

The Consolidated Net Premiums Earned used in the calculation represent the latest 12 months of net premiums earned up to December 31, 2016.

Modeling catastrophe threat scenarios is a complex exercise involving numerous variables and is inherently subject to significant uncertainties and contingencies. These uncertainties and contingencies can affect

actual losses and could cause actual losses incurred by the Company to differ materially from those expressed above. Should an event occur, the modeled outcomes may prove inadequate, possibly materially so. This may occur for a number of reasons including, legal requirements, model deficiency, non-modeled risks or data inaccuracies.

A modeled outcome of net loss from a single event also relies in significant part on the reinsurance and retrocession arrangements in place, or expected to be in place at the time of the analysis, and may change during the year. Modeled outcomes assume that the reinsurance and retrocession in place responds as expected with minimal reinsurance failure or dispute. Reinsurance is purchased to match the original exposure as far as possible, but it is possible for there to be a mismatch or gap in cover which could result in higher than modeled losses to the Company. In addition, many parts of the reinsurance program are purchased with limited reinstatements and, therefore, the number of claims or events which may be recovered from second or subsequent events is limited. It should also be noted that renewal dates of the reinsurance program do not necessarily coincide with those of the inwards business written. Where original business is not protected by risks attaching reinsurance or retrocession programs, the programs could expire resulting in an increase in the possible net loss retained by the Company.

Investors should not rely on the information set forth in this presentation when considering investment in the Company. The information contained in this presentation has not been audited nor has it been subject to independent verification. The estimates set forth above speak only as of the date of this presentation and the Company undertakes no obligation to update or revise such information to reflect the occurrence of future events. The events presented reflect a specific set of prescribed calculations and do not necessarily reflect all events that may impact the Company.

41 of 41