Interim Results

Beazley Group PLC
08 September 2004


                                                                8 September 2004

                               Beazley Group plc

             Interim results for the six months ended 30 June 2004

Beazley Group plc ('Beazley'), one of the Lloyd's market leaders, today
announces its interim results.

Highlights Beazley Group

Earnings potential starting to show:
     •  Profit before tax £22.2m (2003: £2.5m)
     •  Earnings per share 6.7p (2003: 0.7p)
     •  Interim dividend of 0.3p (2003: 0.25p)
     •  Net assets per share increased to 73p (2003: 64p)

Highlights Managed Syndicates

Further significant growth:
     •  Gross premiums written of £394m (2003: £351m)
     •  Net premiums earned of £264m (2003: £222m)
     •  Combined ratio remains low at 85% (2003: 80%)
     •  Lloyd's year of account forecast increased from 11% to 12.3% for 2002; 
        11.5% for 2003
     •  2% year-on-year renewal rate increase; 7% in specialty lines

Andrew Beazley, chief executive, said:

'The trading environment remains strong and we are capitalising on the excellent
opportunities offered by our existing business lines. We are delighted to see
Beazley's earnings potential begin to come through and believe that, by further
improving our access to business, the Group can continue to deliver strong
results.'

Contacts

Beazley Group plc                      Tel: [phone]
Andrew Beazley
Andrew Horton
Nicholas Furlonge

Finsbury                               Tel: [phone]
Melanie Gerlis
Nicola Hobday



Interim results statement

Overall results

The Board of Beazley Group plc is pleased to report a profit before tax for the
six months to 30 June 2004 of £22.2m (2003: £2.5m). As expected, the significant
jump in earnings over 2003 is a reflection of the Group being in its second year
of operation. Net assets per share has increased to 73p from 67p at the end of
2003.

The Group's gross written premiums increased to £211m (2003: £162m) and net
earned premiums increased to £125m (2003: £28m). The gross written premiums have
grown because the Group increased its share of the managed syndicates from 50%
in 2003 to 54% in 2004 and because of the increased business flows in Specialty
Lines. The increase in earned premiums reflects the impact of being in the
second year of operation. The combined ratio for the Group stands at 90%.

Dividend

The Board is pleased to report that it has decided to pay an interim dividend of
0.3p per ordinary share (2003: 0.25p). This will be paid on 26 November 2004 to
shareholders on the register at the close of business on 5 November 2004. The
dividend is in line with our intention, as stated in our annual report, that
dividends will be modest until the 2005 year end. This is due to cash flow
constraints as the first year of account profits for the Group (2003) are not
released from Lloyd's until early 2006.

Managed syndicate results

The combined ratio of the managed syndicates is 85% (2003: 80%). The ratio
remains low as the 2003 underwriting year is performing well and, like the 2002
underwriting year is relatively free of catastrophic losses. The forecast return
on capacity for the 2002 year of account has increased from 11% to 12.4%. The
forecast for the 2003 year of account is 11.5%. Gross written premiums for the
managed syndicates increased to £394m from £351m in 2003.

Trading conditions

Overall trading conditions remain good. In the first half, we continue to see
rate increases in our Specialty Lines businesses (up 7%) and a stable rating
environment overall in Property (down 3%), Reinsurance (flat) and Marine (up
1%). Within each of the business lines we are seeing a more varied rating
environment than in 2003, explained in more detail below.

The dynamics of the industry remains the same with the cost of reinsurance
holding steady and investment returns still modest. This means that profits must
be derived from underwriting which we expect to encourage continued discipline
around rates.

Specialty Lines

This business consists of 16 specialist focus groups - 3 short tail and 13
medium tail. These focus groups have different rate, economic and litigation
cycles. Underlying industry growth, increasing product demand and rate
increases, means that the business has continued to grow. The rating environment
remains favourable with an overall rate increase on renewals of 7%. Within this,
certain sectors are beginning to face increasing competition, most noticeably UK
errors and omissions insurance, US healthcare insurance and directors' and
officers' liability insurance. We are continuing to focus our efforts in the
markets where we have specific expertise and substantial experience.

Property Group

Trading conditions remain favourable in all lines of business within the
Property Group. Beazley maintains a strict discipline of reducing its exposure
to business that does not meet its rating criteria. Increased rating pressure
on the large corporate accounts has resulted in some accounts, where we consider
rates to have fallen too far, being lost. However rates continue to hold on
smaller accounts in most territories.

We are pleased to announce the addition of a new engineering team who joined
Beazley at the beginning of September to focus on developing a specialist
engineering construction account.

Reinsurance

After three years of positive rate activity, the recent lack of large losses has
put a downward pressure on rates. Rates on renewal business for the first half
are flat overall, however the more recent business undertaken is showing rate
reductions of between 5% and 10%. This is after rate increases in 2002 and 2003
of 44% and 4% respectively. We continue to focus on our core markets with an
increasing emphasis on Europe.

Along with the Property Group, our reinsurance portfolio has an exposure to
Hurricane Charley. Current information about the actual damage caused by the
hurricane is still subjective, and the numbers are likely to change. However
based on current estimates, the Group's exposure falls within our planned loss
activity.

Marine

We have experienced healthy expansion in light of the recruitment of new
underwriting teams during 2003.

Across the marine portfolio as a whole rate changes are flat. Small increases in
the hull and liability accounts are balanced out with modest decreases within
the energy and war accounts.

Improved access to business

The Group continues to enhance access to its desired lines of business. Beazley
USA Services Inc. has been formed and located in Hartford, Connecticut, USA. The
company will operate to supplement the existing portfolio of small to medium
sized business, through targeting business that currently does not flow to
Lloyd's. The company will underwrite on behalf of the managed syndicates. Heads
of both Property and Specialty Lines have been hired and they join the existing
Chief Operating and Financial Officer.

The ownership of Cover Solutions Ltd, a managing general agent in the UK, which
already underwrites on behalf of the managed syndicates has been assumed by the
Group this year. This again aims to secure wider access and control over the
smaller accounts in our existing product lines.

Capital resources

For 2004 the Group's underwriting is supported by £132m of the Group's own funds
and £19.5m from our letter of credit facility. The capacity of the combined
syndicates is planned to remain at £741m (subject to approval by Lloyd's) for
the 2005 underwriting year - Beazley's owned capacity will be at least £397m.
The capital required for 2004 was calculated as 40% of premiums. This is the
minimum allowed under the risk based capital model at Lloyd's. For our 2005
underwriting year this percentage is likely to increase to 49%. Capital under
the risk based capital model is required for two elements of our business - the
underwriting risk capital needed for the future business that we are going to
write, and the reserving risk capital for the business we have written. As we
have been growing and have a reasonable sized medium tail book our reserves have
increased and therefore the required reserving risk capital has also increased.

The extra capital required for 2005 will come from our increased banking
facility where we have recently agreed a £70m syndicated letter of credit
facility with an option of using up to £40m as cash funding.

The Financial Services Authority (FSA) issued their guidance on internal capital
assessment (ICA) earlier in the year and we are well underway in our project to
deliver our internal assessment of capital required in early 2005.

Investments

Total funds under management (investments plus cash) for the Group have
increased from £180m a year ago to £352m as the funds from our underwriting
activities have increased. The funds under management for the Group will
continue to grow as the average duration of our claims payment is about three
and half years.

In 2004 we have diversified our asset base and have invested $70m of our funds
in alternative assets (high yield bonds, equities and hedge funds). Half of the
$70m has been invested in a portfolio of hedge funds. We have done this through
the fund manager Union Bancaire Privee who will manage the funds and the asset
allocation between the types of investments within a defined risk budget.

Outlook

Taking the portfolio as a whole, the Group expects rates to remain at these high
levels for 2004 and for the market to be generally stable for 2005. We continue
to apply our historic disciplines to ensure we are underwriting for profit.
Whilst this will become more challenging when the market cycle changes, Beazley
is confident that its cross-cycle experience will enable the Group to continue
delivering excellent results.

Andrew Beazley
Chief Executive Officer

8 September 2004





Consolidated profit and loss account
6 months ended 30 June 2004
Technical account general business

                                                   6 months       6 months         Year to
                                                      ended          ended     31 Dec 2003
                                                30 Jun 2004    30 Jun 2003        (audited)
                                                 (unaudited)    (unaudited)  
                                       Notes          £'000          £'000           £'000
-----------------------------------    -----    -----------    -----------     -----------
Earned premiums, net of reinsurance
Gross premiums written                   1          210,778        161,625         333,615
Outward reinsurance premiums                        (71,660)       (57,905)        (68,932)
-----------------------------------    -----    -----------    -----------     -----------
Net premiums written                     1          139,118        103,720         264,683

Change in the gross provision for
unearned premiums                                   (49,494)      (119,325)       (165,620)
Change in the provision for unearned
premiums, reinsurers' share                          35,631         43,908          32,743
-----------------------------------    -----    -----------    -----------     -----------
Change in the net provision
for unearned premiums                               (13,863)       (75,417)       (132,877)
-----------------------------------    -----    -----------    -----------     -----------
Earned premiums, net of reinsurance                 125,255         28,303         131,806
-----------------------------------    -----    -----------    -----------     -----------
Allocated investment return
transferred from the non-technical
account                                  3            6,074          3,647           8,740
-----------------------------------    -----    -----------    -----------     -----------
Claims incurred, net of reinsurance
Claims paid:
Gross amount                                        (13,059)          (652)         (5,808)
Reinsurers' share                                       548              1             159
-----------------------------------    -----    -----------    -----------     -----------
Net claims paid                                     (12,511)          (651)         (5,649)
-----------------------------------    -----    -----------    -----------     -----------
Change in the provision for claims:
Gross amount                                        (68,650)       (26,786)        (99,570)
Reinsurers' share                                    11,283         11,538          27,575
-----------------------------------    -----    -----------    -----------     -----------
Change in the net provision
for claims                                          (57,367)       (15,248)        (71,995)
-----------------------------------    -----    -----------    -----------     -----------
Claims incurred, net of reinsurance      1          (69,878)       (15,899)        (77,644)
-----------------------------------    -----    -----------    -----------     -----------
Net operating expenses                  1,2         (38,174)       (13,370)        (43,035)
-----------------------------------    -----    -----------    -----------     -----------
Balance on the technical account                     23,277          2,681          19,867
-----------------------------------    -----    -----------    -----------     -----------

All operations of the Group are continuing


Consolidated profit and loss account
6 months ended 30 June 2004
Non-technical account

                                                   6 months       6 months         Year to
                                                      ended          ended     31 Dec 2003
                                                30 Jun 2004    30 Jun 2003        (audited)
                                                 (unaudited)    (unaudited)  
                                       Notes          £'000          £'000           £'000
-----------------------------------    -----    -----------    -----------     -----------
Balance on the technical account 
for general business                                 23,277          2,681          19,867
-----------------------------------    -----    -----------    -----------     -----------
Investment income                        3            5,220          3,177           6,670
Unrealised gains/(losses) on 
investments                                            (893)           (98)           (682)
Investment management expenses and
charges                                                (160)          (333)           (250)
-----------------------------------    -----    -----------    -----------     -----------
                                                      4,167          2,746           5,738
Allocated investment return 
transferred to the general
business technical account               3           (6,074)        (3,647)         (8,740)
-----------------------------------    -----    -----------    -----------     -----------
                                                     (1,907)          (901)         (3,002)
Other income                             4            6,400          8,325          11,245
Other charges                                        (5,599)        (7,562)        (10,993)
-----------------------------------    -----    -----------    -----------     -----------
Profit on ordinary activities
before tax                                           22,171          2,543          17,117
-----------------------------------    -----    -----------    -----------     -----------
Comprising:
Operating profit/(loss) based on
longer term investment return                        23,950          2,212          18,732
Share of operating profit of
associate                                               128          1,232           1,387
Short term fluctuations in 
investment return                                    (1,907)          (901)         (3,002)
-----------------------------------    -----    -----------    -----------     -----------
                                                     22,171          2,543          17,117
-----------------------------------    -----    -----------    -----------     -----------
Taxation:
On ordinary activities                               (6,872)          (866)         (5,295)
-----------------------------------    -----    -----------    -----------     -----------
Profit on ordinary activities
after tax                                            15,299          1,677          11,822
-----------------------------------    -----    -----------    -----------     -----------
Dividends - interim                      5             (689)          (574)           (574)
Dividends - final                                         -              -          (1,148)
-----------------------------------    -----    -----------    -----------     -----------
                                                       (689)          (574)         (1,722)
-----------------------------------    -----    -----------    -----------     -----------
Retained profit for the period                       14,610          1,103          10,100
-----------------------------------    -----    -----------    -----------     -----------
Basic earnings per share
(pence per share)                        6             6.7p           0.7p            5.2p
Diluted earnings per share (pence
per share)                               6             6.7p           0.7p            5.2p


Consolidated statement of total recognised gains and losses

Profit on ordinary activities after 
tax                                                  15,299          1,677          11,822
-----------------------------------    -----    -----------    -----------     -----------
Exchange differences taken to 
reserves                                               (700)             -          (1,623)
-----------------------------------    -----    -----------    -----------     -----------
Total recognised gains or losses                    14, 599          1,677          10,199
-----------------------------------    -----    -----------    -----------     -----------


Consolidated balance sheet
as at 30 June 2004

                                                   6 months       6 months         Year to
                                                      ended          ended     31 Dec 2003
                                                30 Jun 2004    30 Jun 2003        (audited)
                                                 (unaudited)    (unaudited)  
                                                      £'000          £'000           £'000
----------------------------------------        -----------    -----------     -----------
Assets
Intangible assets                                     6,887          6,096           7,065
----------------------------------------        -----------    -----------     -----------
Investments
Investment in associated undertaking                  1,341          6,105           1,212
Other financial investments                         317,738        132,269         241,043
----------------------------------------        -----------    -----------     -----------
                                                    319,079        138,374         242,255
----------------------------------------        -----------    -----------     -----------
Reinsurers' share of technical
provisions
Provisions for unearned premiums                     66,589         43,167          30,968
Claims outstanding                                   36,890         11,347          25,775
----------------------------------------        -----------    -----------     -----------
                                                    103,479         54,514          56,743
----------------------------------------        -----------    -----------     -----------
Debtors
Debtors arising out of direct insurance
operations                                           84,918         67,151          58,780
Debtors arising out of reinsurance
operations                                           17,909          5,634          19,851
Other debtors                                         2,669          1,839           1,621
----------------------------------------        -----------    -----------     -----------
                                                    105,496         74,624          80,252
----------------------------------------        -----------    -----------     -----------
Other assets
Cash at bank and in hand                             34,135         47,947          19,407
----------------------------------------        -----------    -----------     -----------
Prepayments and accrued income
Accrued interest                                         76              -             170
Deferred acquisition costs                           37,778         20,365          30,484
Other prepayments and accrued
income                                               15,035         11,253           9,282
----------------------------------------        -----------    -----------     -----------
Total assets                                        621,965        353,173         445,658
----------------------------------------        -----------    -----------     -----------


Consolidated balance sheet
as at 30 June 2004

                                                   6 months       6 months         Year to
                                                      ended          ended     31 Dec 2003
                                                30 Jun 2004    30 Jun 2003        (audited)
                                                 (unaudited)    (unaudited)  
                                                      £'000          £'000           £'000
----------------------------------------        -----------    -----------     -----------
Liabilities

Capital and reserves
Called up share capital                              11,474         11,474          11,474
Share premium account                               132,377        132,377         132,377
Merger reserve                                        1,675          1,675           1,675
Profit and loss account                              21,769            485           7,859
----------------------------------------        -----------    -----------     -----------
Shareholders' funds attributable
to equity interests                                 167,295        146,011         153,385
----------------------------------------        -----------    -----------     -----------
Technical provisions
Provision for unearned premiums                     203,990        117,327         155,765
Claims outstanding                                  161,494         26,373          93,436
----------------------------------------        -----------    -----------     -----------
                                                    365,484        143,700         249,201
----------------------------------------        -----------    -----------     -----------
Deferred Tax                                          7,288              -           3,506
----------------------------------------        -----------    -----------     -----------
Creditors
Creditors arising out of direct
insurance operations                                 56,069         42,748          28,334
Creditors arising out of reinsurance
operations                                           10,195          1,850             135
Other creditors including taxation and
social security                                       4,596         10,805           3,564
----------------------------------------        -----------    -----------     -----------
                                                     70,860         55,403          32,033
----------------------------------------        -----------    -----------     -----------
Accruals and deferred income                         11,038          7,453           7,533
----------------------------------------        -----------    -----------     -----------
Loans                                                     -            606               -
----------------------------------------        -----------    -----------     -----------
Total liabilities                                   621,965        353,173         445,658
----------------------------------------        -----------    -----------     -----------



Consolidated cash flow statement
for the 6 months ended 30 June 2004

                                                   6 months       6 months         Year to
                                                      ended          ended     31 Dec 2003
                                                30 Jun 2004    30 Jun 2003        (audited)
                                                 (unaudited)    (unaudited)  
                                       Notes          £'000          £'000           £'000
-----------------------------------    -----    -----------    -----------     -----------
Net cash flow from operating
activities                               7           93,556         42,583         125,848
Taxation recovered paid                                (963)          (232)         (1,091)
Capital expenditure - purchase of
syndicate capacity                                      (22)             -          (1,141)
Equity dividends paid                                (1,148)             -            (574)
Financing                                         
- Increase/(Decrease) in debt                             -            606               -
-----------------------------------    -----    -----------    -----------     -----------
Net cash flows                                       91,423         42,957         123,042
-----------------------------------    -----    -----------    -----------     -----------

Cash flows were invested as 
follows:
Increase/(decrease) in cash
holdings                                             14,728         42,957          14,417
Increase/(decrease) in debt
securities and other fixed
asset investments                                    76,695              -         108,625
-----------------------------------    -----    -----------    -----------     -----------
Net investment cash flows                            91,423         42,957         123,042
-----------------------------------    -----    -----------    -----------     -----------

Notes to the interim financial statements
For the 6 months ended 30 June 2004

Basis of preparation

The unaudited interim accounts have been prepared on the basis of accounting
policies consistent with those set out in the Group's 2003 Annual Report.

These accounts are in compliance with the Statement of Recommended Practice on
accounting for insurance business issued by the Association of British Insurers
in November 2003 (ABI SORP).

In accordance with the provisions relating to insurance companies under Schedule
9a of the Companies Act 1985, the accounts include the transactions, assets and
liabilities of syndicate 2623 on which certain subsidiary companies participate
as corporate members of Lloyd's, accounted for on an annual basis.

The unaudited interim report, the comparative figures for the year ended 31
December 2003 and the financial information contained in these interim results,
do not constitute statutory accounts of the Group within the meaning of Section
240 of the Companies Act 1985.

The results for the 6 months ended 30 June 2004 and 2003 are unaudited, but have
been reviewed by the auditors. The auditors have reported on the statutory
accounts for the year ended 31 December 2003 and the accounts have been
delivered to The Registrar of Companies. The auditor's report in respect of the
year ended 31 December 2003 was unqualified and did not contain a statement
under section 237 (2) or (3) of the Companies Act 1985.

1. Segmental analysis

An analysis of the balance on the technical account of the Group (syndicate 2623
only) for the six months to 30 June 2004, is as follows:

                       Specialty Lines   Property    Marine   Reinsurance     Total
                                 £'000      £'000     £'000         £'000     £'000
--------------------   ---------------   -------- ---------   ----------- ---------
Gross premiums written          98,375     47,143    32,800        32,460   210,778
Net premiums written            53,160     40,480    21,398        24,080   139,118
Net earned premiums             60,119     32,666    16,603        15,867   125,255
Investment income                3,508      1,418       498           650     6,074
Net claims                     (40,691)   (14,325)   (8,424)       (6,438)  (69,878)
Expenses (Note 2)              (16,820)   (10,731)   (5,803)       (4,820)  (38,174)
--------------------   ---------------   -------- ---------   ----------- ---------
Balance on technical 
account                          6,116      9,028     2,874         5,259    23,277
--------------------   ---------------   -------- ---------   ----------- ---------
Claims ratio                      67.7%      43.9%     50.7%         40.6%     55.8%
Expense ratio                     36.2%      33.5%     38.3%         25.0%     33.7%
Combined ratio                   103.9%      77.4%     89.0%         65.6%     89.5%

No comparatives for the six months to 30 June 2003 are shown as they would be
misleading. This is because the Group's syndicate only commenced business on 1
January 2003.

2. Net operating expenses

                                                   6 months       6 months         Year to
                                                      ended          ended     31 Dec 2003
                                                30 Jun 2004    30 Jun 2003        (audited)
                                                 (unaudited)    (unaudited)  
                                                      £'000          £'000           £'000
----------------------------------------        -----------    -----------     -----------
Acquisition costs                                    36,537         26,616          63,985
Change in deferred acquisition costs                 (7,411)       (19,201)        (32,203)
Administrative expenses                               9,048          5,955          11,253
----------------------------------------        -----------    -----------     -----------
                                                     38,174         13,370          43,035
----------------------------------------        -----------    -----------     -----------


3. Investment return

a. The total actual investment return before taxation comprises:

                                                   6 months       6 months         Year to
                                                      ended          ended     31 Dec 2003
                                                30 Jun 2004    30 Jun 2003        (audited)
                                                 (unaudited)    (unaudited)  
                                                      £'000          £'000           £'000
----------------------------------------        -----------    -----------     -----------
Investment return on funds at
Lloyd's and other corporate funds:
Investment income                                     3,386          2,786           5,924
Unrealised gains/(losses) on investments               (457)           (98)           (406)
Realised gains/(losses) on investments                   68            (29)           (292)
----------------------------------------        -----------    -----------     -----------
                                                      2,997          2,659           5,226
----------------------------------------        -----------    -----------     -----------

Investment return on syndicate funds:
Investment income                                     1,969            420           1,102
Unrealised gains/(losses) on investments               (436)             -            (276)
Realised gains/(losses) on investments                 (203)             -             (64)
----------------------------------------        -----------    -----------     -----------
                                                      1,330            420             762
----------------------------------------        -----------    -----------     -----------
Investment management expenses                         (160)          (333)           (250)
----------------------------------------        -----------    -----------     -----------
Total investment return                               4,167          2,746           5,738
----------------------------------------        -----------    -----------     -----------
Allocation to the technical account 
based on the longer term rate                        (6,074)        (3,647)         (8,740)
----------------------------------------        -----------    -----------     -----------
Short term fluctuations in investment
return retained in the non-technical
account                                              (1,907)          (901)         (3,002)
----------------------------------------        -----------    -----------     -----------

b. Longer term investment return

The longer term return is based on a combination of historical experience and
current expectations for each category of investments. The longer term return is
calculated by applying the following yields to the weighted average of each
category of assets.

                                                   6 months       6 months         Year to
                                                      ended          ended     31 Dec 2003
                                                30 Jun 2004    30 Jun 2003        (audited)
                                                 (unaudited)    (unaudited)  
                                                          %              %               %
----------------------------------------        -----------    -----------     -----------
Debt securities and other fixed
interest securities
- Sterling                                                5              5               5
- Dollar                                                  4              4               4

4.      Other income

                                                   6 months       6 months         Year to
                                                      ended          ended     31 Dec 2003
                                                30 Jun 2004    30 Jun 2003        (audited)
                                                 (unaudited)    (unaudited)  
                                                      £'000          £'000           £'000
----------------------------------------        -----------    -----------     -----------
Profit commissions                                    5,192          6,160           7,979
Agency fees                                           1,010            931           1,908
Other income (including share of
profit in associated companies)                         198          1,234           1,358
----------------------------------------        -----------    -----------     -----------
                                                      6,400          8,325          11,245
----------------------------------------        -----------    -----------     -----------

5. Dividends

An interim dividend of 0.3p (net) per Ordinary Share has been declared payable
on 26 November 2004 to shareholders registered on 5 November 2004 in respect of
the six months to 30 June 2004 (30 June 2003: 0.25p (net) per Ordinary Share).

6. Earnings per ordinary share

                                                   6 months       6 months         Year to
                                                      ended          ended     31 Dec 2003
                                                30 Jun 2004    30 Jun 2003        (audited)
                                                 (unaudited)    (unaudited)  
----------------------------------------        -----------    -----------     -----------
Basic                                                  6.7p           0.7p            5.2p
Diluted                                                6.7p           0.7p            5.2p

The calculation of basic earnings per share is based on earnings of £15,299,000
(2003: £1,677,000 being the profit for the year on 229.48 million shares (2003:
229. 48 million), being the weighted average number of shares in issue during
the period.

The diluted earnings per share is based on earnings of £15,299,000 (2003:
£1,677,000) and on 229.6 million ordinary shares (2003: 229.5 million).

7. Reconciliation of operating profit to net cash inflow from operating
activities

                                                   6 months       6 months         Year to
                                                      ended          ended     31 Dec 2003
                                                30 Jun 2004    30 Jun 2003        (audited)
                                                 (unaudited)    (unaudited)  
                                                      £'000          £'000           £'000
----------------------------------------        -----------    -----------     -----------
Operating profit before tax based on
longer term rate of investment
return                                               24,078          2,543          20,119
Amortisation of goodwill                                201            172             344
Short-term fluctuations in investment
return                                               (1,907)          (714)         (3,002)
Share in profit of associate                           (128)             -          (1,387)
(Increase) in debtors                               (38,197)      (102,663)       (116,610)
(Increase) in reinsurers share of
technical provision                                 (46,736)       (54,514)        (56,743)
Increase in creditors                                40,662         54,059          35,549
Increase in technical provisions                    116,283        143,700         249,201
Effect of foreign exchange rate
changes                                                (700)             -          (1,623)
----------------------------------------        -----------    -----------     -----------
                                                     93,556         42,583         125,848
----------------------------------------        -----------    -----------     -----------


Independent review report by KPMG Audit Plc
to the members of Beazley Group plc


Introduction

We have been engaged by the company to review the financial information set out
on pages 7 to 14 and we have read the other information contained in the interim
report and considered whether it contains any apparent misstatements or material
inconsistencies with the financial information.

This report is made solely to the company in accordance with the terms of our
engagement to assist the company in meeting the requirements of the Listing
Rules of the Financial Services Authority. Our review has been undertaken so
that we might state to the company those matters we are required to state to it
in this report and for no other purpose. To the fullest extent permitted by law,
we do not accept or assume responsibility to anyone other than the company for
our review work, for this report, or for the conclusions we have reached.

Directors' responsibilities

The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The directors
are responsible for preparing the interim report in accordance with the Listing
Rules which require that the accounting policies and presentation applied to the
interim figures should be consistent with those applied in preparing the
preceding annual accounts except where they are to be changed in the next annual
accounts in which case any changes, and the reasons for them, are to be
disclosed.

Review work performed

We conducted our review in accordance with guidance contained in Bulletin 1999/
4: Review of interim financial information issued by the Auditing Practices
Board for use in the United Kingdom. A review consists principally of making
enquiries of management and applying analytical procedures to the financial
information and underlying financial data and, based thereon, assessing whether
the accounting policies and presentation have been consistently applied unless
otherwise disclosed. A review is substantially less in scope than an audit
performed in accordance with Auditing Standards and therefore provides a lower
level of assurance than an audit. Accordingly we do not express an audit opinion
on the financial information.

Review conclusion

On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 June 2004.

KPMG Audit Plc
Chartered Accountants
Registered auditor
London

8 September 2004




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