Exercise of Warrants

Lancashire Holdings Limited
15 August 2007


Lancashire Holdings Limited
15 August 2007


                             Director Shareholding



Lancashire Holdings Limited (the 'Company') has been notified that Neil
McConachie, executive director and Chief Financial Officer, yesterday exercised
warrants over 500,000 common shares of US$0.50 each in the Company by way of
cashless exercise. Pursuant to the terms of the warrants the exercise price is
$5.00 and the cashless exercise sale price is $7.10 (based on a market value 5
day average) resulting in 148,025 shares. Neil McConachie's total shareholding
in the Company following the warrant exercise and the subsequent issue of shares
will be 175,525 shares.



For further information, please contact:

Lancashire Holdings
Greg Lunn                             [phone]


Financial Dynamics                    [phone]
Robert Bailhache


www.lancashiregroup.com


About Lancashire


Lancashire, through its UK and Bermuda-based insurance subsidiaries, is a global
provider of specialty insurance products. Its insurance subsidiaries carry the
Lancashire group rating of A minus (Excellent) from A.M. Best with a stable
outlook. Lancashire has capital in excess of US$1 billion and its common shares
trade on AIM under the ticker symbol LRE. Lancashire is headquartered at
Mintflower Place, 8 Par-La-Ville Road, Hamilton HM 08, Bermuda. The mailing
address is Lancashire Holdings Limited, P.O. Box HM 2358, Hamilton HM HX,
Bermuda. For more information on Lancashire, visit the Company's website at
www.lancashiregroup.com.












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