Good day, ladies and gentlemen, and welcome to the Third Quarter 2008 Allied World Assurance Company Earnings Call. My name is Jasmine, and I will be your coordinator for today. At this time, all participants are in a listen-only mode. We will conduct a question-and-answer session towards the end of this conference. [Operator Instructions]. I would now like to turn the presentation over to your host for today's call, Mr. Keith Lennox, Investor Relations Officer. You may proceed sir. Keith J. Lennox: Thank you. Good morning everyone, and welcome to Allied World's third quarter 2008 earnings conference call. Our earnings press release and financial supplement were issued last night after the market closed. If you like copies of either, please visit the Investor Relations section of our website at www.awac.com. Today's call will also be available through November 21st as a webcast on our website and as a teleconference replay. The dial-in information for this replay is included in our earnings press release. Our speakers this morning includes Scott Carmilani, Allied World's President and Chief Executive Officer; and Joan Dillard, the company's Chief Financial Officer. Also with us to assist with question are several members of our management team. I will remind everyone that statements made during today's call including the question-and-answer session, which are not historical facts, may be forward-looking statements within the meaning of the US Federal Securities Laws. Forward-looking statements include all statements that do not relate solely to historical or current facts and can be identified by the use of words such as may, should, estimate, anticipate, intend, belief, predict, potential or words of similar importance generally involving forward-looking statements. These forward-looking statements are based upon the company's current plans or expectations, and are subject to a number of uncertainties and risks that could significantly affect current plans, anticipated actions, and the company's future financial condition and results. The uncertainties and risks include, but are not limited to those disclosed in the company's filings with the Securities and Exchange Commission. As a consequence, current plans, anticipated actions and future financial conditions and results may differ from those expressed in any forward-looking statements made by or on behalf of the company today. Additionally, forward-looking statements speak only of the date they are made and the company assumes no obligation to update or revise any of them in light of new information, future events or otherwise. Finally, during the call, management will discuss information regarding operating income, diluted book value per common share and annualized return on average shareholders equity, which are non-GAAP measures within the meaning of the US Federal Securities Laws. For more information and a reconciliation of these measures to the most directly comparable GAAP financial measures, please refer to our earnings press release which was issued last night and as available on our website. With that complete, I will now turn the call over to Scott. Scott A. Carmilani: Thanks Keith and good morning everybody. Its certainly be the turbulent time with a new of major events occurring which has impacted our industry and our economy. The disruptions in the financial markets as federal government intervention to assist financial institution and the third quarter CAD axillary have all let likely the dislocation of the insurance and the reinsurance market. Clearly I will turn the cycles to many lines of coverage. For all part Allied has strong capital base, strong ratings, remain solid throughout these events. We are emerging as a company with both the breadth and capacity to take advantage of the potential opportunity that may develop. The investments that we have made today to build out our operations during 2008 have expanded our product offerings, our service capabilities and our geographic reach, as well as having really enhanced our ability to meet the needs of our current and perspective customers in both the insurance and reinsurance operations. We have also recently brought in a number of new profession staff to both support and lead our efforts in the US specialty platform. One such area as you may have seen in our recent press release, we guided a Chief Investment Officer John Glacier to manage our 6 billion plus fixed income and investment portfolio. We feel it is an important enterprise risk management addition to our team as we grow and diversify our portfolio managers and our investment in the US Global, we are very happy to have recently closed on our acquisition of Darwin Professional Underwriters, especially healthcare carrier we may know, and is also strong professional expertise. We welcome our new colleagues from Darwin and I am proud of the significant stride that we always have been making in integrating them by US operations. In my view the recent market events validate the importance of this acquisition in a long-term prosperity all over the world. The acquisition immediately doubles our footprint in the US, for products and services and now gives us a much needed primary platform from this offering. Darwin also further expands our special liability and they are known for product and technological innovation. One example you can see is the small business technology platform for writing primary professional liability via the internet called i-bind. We have made significant investments throughout the year and not just the acquisition of Darwin. We significantly added to our administrative infrastructure our IT system support staff and our claim professionals. We are now come 555 strong all prepared to better meet the developing opportunities being presented in the market. The investments that we have made will help us execute on this long-term value within strategy. Given the financial and market turmoil that we are seeing and to write the outcomes for the changes to our industries and capital structure, I am glad that we struck to this plan. With our financial strength, our clean balance sheet, and strong liquidity position, we have to tools we need to capitalize on the market opportunities that now lay before us. Early indicators on this are promising. Our submission and business activity in the third quarter are up exponentially from the US from potential customers looking for new and diversified capacity for the programs. Let's turn to our results. We are reporting very strong operating income of 102.8 million for the third quarter and 313 million year-to-date. The $72 million of losses that we incurred for Hurricanes Ike and Gustav were manageable and well within our risk tolerances. We believe this demonstrates our strong risk management and our conservative approach when it comes to managing our property calculation. Huge factor and even the impact able losses, the company is able to generate operating of over $100 million for the quarter and we continue to benefit from our investment income in positive reserve dollars for the quarter. Gross production and premium increased by almost $15 million or 5.3% for the quarter versus the third quarter of 2007. The increase is primarily driven by our casualty insurance segment while gross premiums increased by around 18 million and as a result of the increased writings in our US offices. The premiums in our property segment we actually down by almost 3 million for the quarter, reflecting a continued non-renewal of the energy business in that sector as not meeting our pricing terms and our conditions. Lastly our reinsurance segment was flat for the year because we are maintaining a conservative stance until we see more improvement in that market place. I will conclude my remarks today, by noting in our operating income due September was 314 million for nine months and then our year-to-date operating ROE is still impressive 19%. Allied World continued to maintain a strong balance sheet and substantial investment momentum. I will reiterate that our company has the financial strength to meet the capacity needs of both our insurance and reinsurance clients. We offer a balance sheet with over $6 billion in cash and invested assets and have maintained our year end 2007 capital of almost 2.8 billion. Our shareholders equity has actually increased slightly, 1.5% from the beginning of the year despite strong losses and then impairments taking in our investment portfolio. And we are pleased that after providing current updates on our integration Darwin and our results to the rating we achieved of AM Best have affirmed Allied World's A rating, excellent financial strength and upgraded Darwin's rating from A to an A-. Additionally S&P has also removed Allied World's rating from credit launch and have find the company has stable outlook. These actions are particularly gratifying given the current environment and the challenges facing our industry. Now I will turn the call over to Joe for some detailed financial highlights. Joan H. Dillard: Thanks, Scott and good morning. Allied World has produced quality results for the third quarter 2008, despite being a challenging quarter for our industry and with what I refer to is an unprecedented 1x50 event in the financial markets. We reported a net loss for the quarter of 46.4 million and net income for the nine months ended September 30 of 163.8 million down from 2007 because of the realized losses in our investment portfolio and from the third quarter storm losses. Operating income for the quarter was 102.8 million and 313.9 million year-to-date. On a diluted per share basis, operating income per share was $2.03 for the quarter and $6.17 per share for the year-to-date, which despite the storm activity in the quarter still exceed to $5.70 operating income per diluted share really earned through the nine months last year. As you recall we acquired 19.4% of our outstanding shares from AIG in December of last year which reduced the overall number of shares outstanding this year. Cash flows from operating activities remain strong at 509 million in operating cash flow year-to-date. We have also recognized greater favorable loss margins in 2008 than in the third quarter 2007. In this quarter we recognized 96.9 million of favorable prior new development versus only 28.6 million in the third quarter 2007. This quarter releases by segment included 24.7 million from the property segment, 32.8 million from the casualty segment and 39.4 million from the reinsurance segment. As we discussed on previous call we have a return plus greater ratings on the born hood and actuarial method for our causality business which is something a national progression for us as we mature as a company and build out our own historical loss experience. This quarter we have just begun to implement this method for our casualty reinsurance lines and that resulted in a 13.5 million of favorable reserve development in that segment. Also included in the positive development this quarter, its 20.9 million of net favorable loss reserve development from the ITC reit business related to older accident years. As you might recall, we terminated our underwriting services agreement with ITC in 2006. We have maintained a conservative level of IBNR for any potential negative development on that business, but after two years we don’t expect any further material development and we are closing out the earlier years. There is still $5 million of IBNR remaining on the ITC runoff business and that will be sufficient to absorb any further development. Now let's look at investment results for the quarter which we have pre-release back in October. Like other in our industry Allied World had meaningful realized and unrealized losses on our investment portfolio resulting from the financial crisis. Our realized losses can be broken down into three main components. First, we recognized $75 million of LTTI charges, resulting primarily from the widening credit spreads in both the mortgage backed and the corporate sectors. We maintain a prospective policy regarding LTTI and where our investment managers retains the discussion to sell securities in our portfolios and securities trading in unrealized loss position, we will recognized the LTTI on that security. As in the side, where the company intents to hold the security to recovery or maturity, the change in market value is reflected and accumulated our comprehensive income ASCI the component of shareholders equity, and this quarter we had 58.8 million of net unrealized losses. Back to the second component of our realized losses is $27.6 million of mark-to-market loss relating to our hedge fund. We have adopted FAS 159 accounting for our hedge funds, so any change in fair value is recognized in realized gains and losses on the income statement. I would also like to note that earlier in Q3 we had given our notice of redemption for two of our funded funds the MST6 and AIG select fund the proceeds of which we expect to receive in the fourth quarter. The third and final component of our realized losses for the quarter is 49.2 million from the sales securities. We had previously announced our exposure to the Lehman Brothers bonds and you’re since sell them for a realized loss netting $25 million. During the quarter we also sold several of our mortgage family bonds to realize losses of $15 million. These losses though were somewhat offset by gains of sales of our securities. In this quarter’s financial supplement that we released on our website last night, we have expanded our investment related disclosures and added more detail on various asset classes, including industry concentrations of our corporate bonds and our Top 10 corporate bond exposures. There is also a more detailed breakdown of our mortgage-backed and asset-backed securities. And finally, as we said before, the investment portfolio has no transactions that required a posting of collateral and does not include any real estate, CDOs, CLOs or any complex financial structures. Our net investment income is fairly consistent with last year’s at $76.9 million this quarter versus 76.1 million and annualized portfolio yield at 4.8% this year versus 4.7% last year. Our operating expenses increased by $5 million in the quarter, resulting in an operating expense ratio of 15% or 2.3 points higher than the 12.7% operating ratio for the third quarter of 2007. However, our operating expenses for the third quarter of 2008 were actually a bit lower than the second quarter 2008 since we reduced the number of consultants that we use in our IT area, and in the second quarter we did have some one-time expenses related to the establishment of our new offices. Our acquisition ratio is down modestly and that will bring the total expense ratio for the nine months ended September 30 to 26%, up from 22% in 2007, and as we have discussed previously this is very much inline with our expectations for the year. Turning to the segment results, our property segment generated $40 million of underwriting loss for the third quarter and a $48.6 million underwriting loss year-to-date. Absent prior-year development, the accident year loss ratio for the third quarter was 223.6% versus 95.4 for the third quarter 2007. But absent the catastrophes, this quarter was 108.8%. The increase in this ratio is being driven primarily by increased attritional loss activity in the current accident year in both the general property and energy lines of business as well as it does reflect the price declines that we have seen in the property segment this year. In the casualty segment, our underwriting income was $36.6 million for the quarter and 80 million year-to-date. Absent the favorable prior-year development, the loss ratio for the third quarter was 75.5% comparing to 72.9% for the third quarter ’07. The uptick in the current year accident year of loss ratio reflects the declines in pricing that we have experienced in the segment thus far this year. In the reinsurance segment, we are reporting an operating income of 29.9 million for the third quarter and almost $73 million year-to-date. Absent prior-year favorable development, the loss ratio for the third quarter was 78.8% and ex-cap 60.8%, which is relatively flat to the 61% for the third quarter last year. As Scott mentioned previously, we are very happy to close on the Darwin transaction in October. In conjunction with the acquisition, we expect to record approximately $65 million in intangible assets and by the way that’s on a pre-tax basis and approximately $250 million in goodwill. These amounts are still subject to change as we finalize the purchase price allocation. In summary, despite the turmoil and the disruption in the markets, we have continued to maintain a strong capital position. Despite the losses in the investment portfolio and two hurricanes, our shareholders’ equity and diluted book value per share has actually increased from December 31, 2007. Our financial leverage has actually improved slightly from the end of last year at 18%. A strong balance sheet and well timed investment in our future are proving to pay dividends by giving us the capacity to capture developing opportunities. Let me turn this call over back to Scott for final comments.

Thanks Joan. I will make the final comments and summary as well. We are very comfortable with our results for the quarter and where we are year-to-date and believe that our strength and flexibility position us very well as we have never seen before time in our industry. We spent some money this year, but we drive it and hit on for us in space and we expected to pay dividend for us as we look forward. None of this would be possible without the support of our management team and all of our people. So I think before we take any question it is appropriate for me to thank them for the leadership and hands on support throughout the year. And with that, I am happy to taken any questions.

(Operator Instructions). Your first question comes from the line of Matt Heimermann of JP Morgan. You may proceed.

Hi good morning it's Heimermann. Couple of questions, first is Scott maybe you could talk about some of the turmoil effecting larger competitors and I am wondering if you’re expecting to see more demand for your excess product out Bermuda and how significant or reversal that could be given, that’s where a lot of the premium pressure was coming over the last 12 months? Scott A. Carmilani: Sure Math. Without getting into too specific because I don’t think that’s my job, in terms of attacking any of competitor, but its very logical that companies that have pretty huge concentrations of risks with any of the majors or we actively looking to see to reduce that or spread that more widely. There has been great interest in our excess product. The fourth quarter of the year tend to be one of the most slower quarters of the year for the buyers those Fortune 500 companies and we expect that we see very significant interest as we enter the first and second quarters next year for our excess product here in the year. As you know, we tend to be one the lead markets in the excess business here in the Allied.

And, would your comments be applicable to the property and casualty excess? Scott A. Carmilani: Well, we participate usually in the primary led or property business. So its really – I am speaking more to the excess, because that’s what your question was on the casualty business. Property, I think even the large company tend to buy big stretches or primaries and there are many competitors out there that offer primary property insurance. So I expect the demand to go up there as well, not just because of the issue that are facing some of our competitors, but I firmly believe that we have to go up on the margins that business regardless.

Okay. And then you spent some money over the last 12 months as well building up the office structure of kind of the legacy Allied World platform or the infrastructure there, and I am wondering, are you starting to see people looking to move in the market that you might actually start to level some of that infrastructure? Scott A. Carmilani: Sure. We’ve hired a quite a number of executives and I did mention that in the call and professional staff in our US operations, our numbers are up significantly not just with the dollars but also in our speciality business in the US. Part of the money we spent was to obtain 34,000 square feet of office space in New York and that’s virtually full as we see that today, and it wasn’t six month. And I would like to point out and I am glad you ask, that you really spent some money this year, our expense ratio is still relatively low in the industry and we’ve already achieved the milestones and the numbers that you are talking about in spite of those expenditures. So we are pretty pleased with how we’ve executed on that plan throughout the year.

And has the hiring kind of continued post the close of the third quarter? Scott A. Carmilani: Oh sure.

And then Joan just one followup question was, I am just missed X CAD, X development combined ratio numbers for reinsurance? Joan H. Dillard: X CAD, X development is 60.8 for the quarter.

Perfect. Okay, thank you very much. Joan H. Dillard: You are welcome.

(Operator Instructions). Your next question comes from the line of Ian Gutterman of Adage Capital Management. You may proceed.

Hi. One numbers question first for some of the markets interest stuff Joan, could you just clarify for me again, I was having trouble making the math of just a dollar amount of the CADs insurance versus reinsurance? Joan H. Dillard: Sure. Between the direct side and the reinsurance side… Scott A. Carmilani: We have $0.72. Joan H. Dillard: $0.72.

Right. Is there any restatement in there or what exactly? Joan H. Dillard: There is restatement renewals at 2.7 million, that’s in the reinsurance segment. And in property the CAD losses breakout in to 49.3 and in reinsurance of 22.3.

Okay. And the.. Joan H. Dillard: But the reinstatement premium would net against the reinsurance losses.

Okay. So that 22.3 is gross or net of the reinstatement done? Joan H. Dillard: That’s gross.

Gross as I thought. And then the 19 or so million of losses that was out in the property segment or is that something reinsurance as well? Scott A. Carmilani: That’s all in the property segment.

As I thought, okay. And, so as far as – it seems like you guys are in a better position than anyone just given your legacy to benefit from what’s going on here. Can you just talk a little bit more about specifically some of the people you hired hired as far as new business opportunities from there, or is it really just adding to your existing capability and what kind of things you do with increasing line sizes or maybe being to move down in catalyst or lead stuff that you are currently before? Scott A. Carmilani: Yeah, let me take that and reverse if I can. We will, we do foresee the potential for us to leave more placements on the commercial business and middle market business, that’s added on to this where we already do from the speciality standpoint in the US, you know, that reflect. When we have more capacity for the bigger excess markets, depending on the rate environment and the opportunity, the answer to that is yes. We have not exercised on that to date as we figure today November 7th or 8th, but we are anticipating that that will probably and likely happen in the New Year and we are preparing for being able to offer more excess capacity for our casualty businesses. But, what we do in the property segment, I think really it will be determined the rate environment and the capacity that’s out there, if you do the math simply the rates are high enough and capacity which should be contracting, but you know, this is industry of repetitive cycle. So I hope we have that goal.

Okay. And most hires are on the US side as opposed to Bermuda? Scott A. Carmilani: All of the new hires is made on the US.

Okay. And so, is this is bigger opportunity as the year progresses that, you’re going to be able to fully leverage that, that it's actually rolled out in the US this year? Scott A. Carmilani: I am sure saying absolutely yes.

Okay. It got to be possibly not enough, do you expect to spend a little bit more, because the opportunity is so big? Scott A. Carmilani: Yes.

Okay interesting. And my last question is just – given again that your legacy of writing excess and lot of AIG lines, how do you view your willingness to write about that, and as opposed to writing about it differently, just given not so much the perception issue, but just – are they lose people and infrastructure, are their concerns about their ability to service the business and then manage your client as where they use to, and obviously picking rate is very important as your ultimate loss experience, has that change your view of – to write about that? Scott A. Carmilani: Well, it’s certainly changes our view and I am going to assume you’re referencing AIG and you are asking that question. But I would like to say and point out that AIG isn’t only the weekend competitor as we sit here today, there are few others. We’ve got and we have to have from our enterprise risk management standpoint, from a credit standpoint to be much more careful than we have it in the past for a number of folks that have been typically lead markets in the past. And I think some of those changes dramatically as we look forward the next year?

Do you think we got into a situation where it seems people are talking about this and other side of the business. But when I get generally we might have customers who wanted to renew it, one of these companies because they feel loyal and the brokers goes to fill out the rest of the tower and we cant get it done and you have a panic at the last moment and we have to switch to it differently to get the rest of the capacity on road? Scott A. Carmilani: Yeah, I don’t know think it will effect who is the lead, as much as it will affect how much the lead get.

Got it. Scott A. Carmilani: In the tower, and how cleans and service gets handled for the whole count. There are some lines of business where the lead will ultimately be changed or diminished dramatically, but in general it is less participation and less spread and don’t underestimate clients they are already starting to evaluate our options in that respect.

Okay. And then just last question, it would seem most people were talking about property moving up first which historically make sense and given the CAT losses make sense, but given some of these things we are talking about, about security and concerned about counterpart and its stuff and also just investment yields being more risky, it would seem that casually needs pricing more than property, would you agree with that or? Scott A. Carmilani: I agree, certain part of casualty need more pricing immediately. And plan immediately and for professional liability, for large account business it is already started to move up quickly than property has, and it's much needed I believe.

Okay. Great, thank you very much for the answers.

There are no other questions at this time. I would now like to turn the call back over to Scott Carmilani for closing remarks. Scott A. Carmilani: Okay. I think I give some closing remarks on the last one. But thank you very much for participating on the call. We look forward to talking you again in the future as we putout our year-end results. Have a great weekend.

Thank you for attending today's conference. This concludes your presentation. You may now disconnect. Good day