Exercise of Warrants

Lancashire Holdings Limited
21 February 2007


Lancashire Holdings Limited

21 February 2007

Exercise of Warrants


Lancashire Holdings Limited (the 'Company') has today applied for 29,444 new
common shares of US$0.50 each in the Company to be admitted to AIM. The new
shares have been issued pursuant to an exercise of warrants to purchase the
Company's common shares. Admission of the new shares is expected to occur on 26
February 2007.


Following the issue of the new shares, the Company's issued share capital
consists of 195,743,346 common shares.


For further information, please contact:

Lancashire Holdings
Neil McConachie                             [phone]
Greg Lunn                                   [phone]

Financial Dynamics                          [phone]
Robert Bailhache
Nick Henderson


www.lancashire.bm

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 $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.lancashire.bm.

NOTE REGARDING FORWARD-LOOKING STATEMENTS

CERTAIN STATEMENTS MADE IN THIS ANNOUNCEMENT THAT ARE NOT BASED ON CURRENT OR HISTORICAL FACTS ARE FORWARD-LOOKING IN  
NATURE INCLUDING, WITHOUT LIMITATION, STATEMENTS CONTAINING WORDS 'BELIEVES', 'ANTICIPATES', 'PLANS', 'PROJECTS',  
'INTENDS', 'EXPECTS', 'ESTIMATES', 'PREDICTS', 'MAY','WILL', 'SEEKS', 'SHOULD' OR, IN EACH CASE, THEIR NEGATIVE OR  
COMPARABLE TERMINOLOGY.  ALL STATEMENTS OTHER THAN STATEMENTS OF HISTORICAL FACTS INCLUDING, WITHOUT LIMITATION, THOSE  
REGARDING THE GROUP'S FINANCIAL POSITION, RESULTS OF OPERATIONS, LIQUIDITY, PROSPECTS, GROWTH, BUSINESS STRATEGY, PLANS 
AND OBJECTIVES OF MANAGEMENT FOR FUTURE OPERATIONS (INCLUDING DEVELOPMENT PLANS AND OBJECTIVES RELATING TO THE GROUP'S  
INSURANCE BUSINESS) ARE FORWARD-LOOKING STATEMENTS.  SUCH FORWARD- LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, 
UNCERTAINTIES AND OTHER IMPORTANT FACTORS THAT COULD CAUSE THE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF THE GROUP 
TO BE MATERIALLY DIFFERENT FROM FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH 
FORWARD-LOOKING STATEMENTS.  THESE FORWARD-LOOKING STATEMENTS SPEAK ONLY AS AT THE DATE OF THIS ANNOUNCEMENT OR OTHER 
INFORMATION CONCERNED. LANCASHIRE HOLDINGS LIMITED EXPRESSLY DISCLAIMS ANY OBLIGATION OR UNDERTAKING (SAVE AS REQUIRED 
TO COMPLY WITH ANY LEGAL OR REGULATORY OBLIGATIONS (INCLUDING THE AIM RULES)) TO DISSEMINATE ANY UPDATES OR REVISIONS 
TO ANY FORWARD-LOOKING STATEMENTS CONTAINED HEREIN TO REFLECT ANY CHANGES IN THE GROUP'S EXPECTATIONS WITH REGARD   
THERETO OR ANY CHANGE IN EVENTS, CONDITIONS OR CIRCUMSTANCES ON WHICH ANY SUCH STATEMENT IS BASED.






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