With respect to AIHL`s insurance operatingunits, earnings from continuing operations, before income taxes, may show aprofit despite an underlying underwriting loss. If underwriting losses persistover extended periods, an insurance company`s ability to continue as an ongoingconcern may be at risk. Investors should consider the non-GAAP measurescontained herein in addition to, and not as a substitute for, measures offinancial performance prepared in accordance with GAAP. The presentation ofunderwriting profit is intended to enhance the understanding of AIHL`s insuranceoperating units` operating results by highlighting earnings attributable totheir underwriting performance. Comment on Regulation GThis press release includes certain non-GAAP financial measures. Thereconciliations of such measures to the most comparable GAAP financial measuresare included herein. Throughout this press release Alleghany presents itsoperations in the way it believes will be most meaningful and useful to theinvesting public and others who use such information in evaluating Alleghany`sresults.

Alleghany shows earnings from continuing operations, before income taxes (a GAAPfinancial measure), as well as underwriting profit (a non-GAAP financialmeasure), which is earnings from continuing operations, before income taxes,adjusted to exclude the impact of net investment income, net realized capitalgains and losses, and other income, less other expenses. As of March 31, 2009, Alleghany had 8,420,321 shares of its common stockoutstanding, adjusted to reflect the common stock dividend declared in February2009 and to be paid on April 24, 2009. Additional information regarding the 2009 first quarter results of Alleghany andits operating units will be contained in Alleghany`s Quarterly Report on Form10-Q for the period ended March 31, 2009, to be filed with the U.S Securitiesand Exchange Commission on or about May 8, 2009. A copy of the Form 10-Q will beavailable on Alleghany`s website at or on the Securities andExchange Commission`s website at Readers are urged to review theForm 10-Q for a more complete discussion of Alleghany`s financial performance inthe 2009 first quarter. * A decrease in corporate administration and other expenses in 2009 from 2008,primarily reflecting lower incentive compensation accruals in the 2009 perioddue in part to less favorable investment results.Information regarding the pre-tax results from continuing operations of AIHL`soperating units is attached as Exhibit A. During the first three months of 2009,Alleghany purchased in the open market an aggregate of 35,755 shares of itscommon stock for approximately $9.1 million, at an average price per share of$254.54, and an aggregate of 313,060 shares of its 5.75% Mandatory ConvertiblePreferred Stock for approximately $83.8 million, at an average price per shareof $267.66, pursuant to the previously announced authorization by its Board ofDirectors to repurchase up to $300.0 million of Alleghany`s common and preferredstock. * Net realized capital losses of $58.6 million at AIHL in 2009, primarilyreflecting $66.1 million of impairment charges for unrealized losses related toAIHL`s investment portfolio that were deemed other than temporary, and as such,were required to be charged against earnings, partially offset by net realizedcapital gains on the sale by AIHL of certain securities.

* A decrease in net realized capital gains at the parent level in 2009 from2008, primarily reflecting net realized capital gains of $53.0 million on thesale at the parent level of common stock of Burlington Northern Santa FeCorporation, compared with $78.1 million of net realized capital gains from suchsales at the parent level during the 2008 first quarter. In addition, recentregulatory developments and judicial decisions, including those of the Workers`Compensation Appeals Board, have materially weakened prior workers` compensationreforms which had been instrumental in reducing medical and disability costs in2004-2006. “The results for Employers Direct continued to be poor in the 2009 firstquarter, reflecting intense price competition in the California workers`compensation market despite rapidly increasing medical and other claims costsand the determination by the Workers` Compensation Insurance Rating Bureau thatadvisory premium rates should be increased by 24.4%. I am also pleased to report that Capitol Transamerica was able toproduce an underwriting profit for the 2009 first quarter despite continuingintense competition across all its lines of business.

Hicks commented that: “We are pleased that RSUI`s underwriting profitincreased in the first quarter of 2009 from the corresponding 2008 period, andalthough the competitive environment continues to be intense, we are encouragedby what we believe may be signs of improving trends in RSUI`s property line ofbusiness. prior to its disposition in October 2008, net of minorityinterest expense and gainon disposition in 2008 for all periods presented. Net earnings amounts include $3.1 million, or $0.37 per common share, of netcatastrophe losses after tax in the 2009 first quarter, compared with anegligible amount of net catastrophe losses after tax in the 2008 first quarter,and $3.7 million, or $0.43 per common share, of net realized capital lossesafter tax in the 2009 first quarter, compared with $48.6 million, or $5.72 percommon share, of net realized capital gains after tax in the 2008 first quarter.Net realized capital losses in the 2009 first quarter include $43.0 million ofunrealized losses, after tax, that were deemed other than temporary, and thusare required to be charged against earnings as realized losses, compared with$9.8 million of such losses in the 2008 first quarter Mr. (4)Corporate activities consist of Alleghany Properties Holdings LLC, Alleghany`s investments in Homesite Group Incorporated and ORX Exploration, Inc., and corporate activities at the parent level.

(5)Discontinued operationsconsist of the operationsof Darwin Professional Underwriters, Inc. (3)2009 and 2008 first quarter results include $66.1million and $15.1 million, respectively, of other than temporary impairment charges for unrealized losses primarily related to AIHL`s equity security holdings that are required to be charged againstearnings as realized losses. (“RSUI”), Capitol Transamerica Corporation and Platte River Insurance Company (collectively, “CATA”) and EmployersDirect Corporation (“EDC”), as well as AIHL Re LLC (“AIHL Re”).(2)Represents net premiumsearned less loss and lossadjustment expenses andunderwriting expenses, all as determined in accordance with GAAP, and does notinclude net investment income, net realized capital (losses) gains orother income, less other expenses Please refer to”Comment on Regulation G”elsewhere herein. After purchases by Alleghany ofshares of its capital stock for approximately $92.9 million during the 2009first quarter, cash and invested assets, on a consolidated basis, wereapproximately $4.11 billion at March 31, 2009, a decrease of 4.2% fromapproximately $4.29 billion at December 31, 2008. Hicks, President and chief executiveofficer of Alleghany, announced today. Alleghany`s net earnings in the 2009first quarter were $44.6 million, or $4.82 per common share (presented on abasic basis throughout), compared with net earnings of $95.9 million, or $10.78per common share, in the first quarter of 2008. NEW YORK–(Business Wire)–Stockholders` equity per common share of Alleghany Corporation (NYSE:Y) at March31, 2009 was $277.35, a decrease of 0.3% from stockholders` equity per commonshare of $278.17 at December 31, 2008 (all as adjusted for the stock dividenddeclared in February 2009), Weston M.