8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report Pursuant to Section 13 OR 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)

July 28, 2010

Everest Re Group, Ltd.

(Exact name of registrant as specified in its charter)

Bermuda	1-15731	98-0365432
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)
Wessex House – 2nd Floor 45 Reid Street PO Box HM 845 Hamilton HM DX, Bermuda		Not Applicable
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code 441-295-0006

Not Applicable

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 DISCLOSURE OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION

 On July 28, 2010, the registrant issued a news release announcing its second quarter 2010 results. A copy of that news release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.

 The news release furnished herewith contains information regarding the registrant’s operating income (loss).  Operating income (loss) differs from net income (loss), the most directly comparable generally accepted accounting principle financial measure, only by the exclusion of realized capital gains (losses) on investments and gains on debt repurchase.  Management believes that presentation of operating income (loss) provides useful information to investors because it more accurately measures and predicts the registrant’s results of operations by removing the variability arising from the management of the registrant’s investment portfolio.  In addition, management, analysts and investors use operating income (loss) to evaluate the financial performance of the registrant and t he insurance industry in general.

 In accordance with general instruction B.2 of Form 8-K, the information in this report, including exhibits, is furnished pursuant to Item 2.02 and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section.

Item 9.01 FINANCIAL STATEMENTS AND EXHIBITS

(c)	Exhibits
	Exhibit No.	Description
	99.1	News Release of the registrant, dated July 28, 2010

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

EVEREST RE GROUP, LTD.
By:	/S/  DOMINIC J. ADDESSO
	Dominic J. Addesso
	Executive Vice President and
	Chief Financial Officer

Dated:  July 28, 2010

EXHIBIT INDEX

Exhibit Number	Description of Document	Page No.
99.1	News Release of the registrant, dated July 28, 2010	5

EX-99.1

            NEWS RELEASE

EVEREST RE GROUP, LTD.

Wessex House, 45 Reid Street, 2nd Floor, Hamilton HM DX, Bermuda

Contact:  Elizabeth B. Farrell

Vice President, Investor Relations

Everest Global Services, Inc.

908.604.3169

For Immediate Release

Everest Re Group Grows Book Value per Share 5% in Second Quarter 2010 to $107.31

HAMILTON, Bermuda – July 28, 2010 -- Everest Re Group, Ltd. (NYSE: RE) reported second quarter 2010 after-tax operating income1, which excludes net realized capital gains and losses, of $184.8 million, or $3.18 per diluted common share, compared to after-tax operating income1 of $256.2 million, or $4.16 per diluted common share, in the second quarter of 2009. Net income, including net realized capital gains and losses, was $156.7 million, or $2.70 per diluted common share, for the second quarter of 2010 compared to $272.6 million, or $4.43 per diluted common share, for the same period last year.

For the six months ended June 30, 2010, after-tax operating income1 was $111.0 million, or $1.89 per diluted common share, compared to $362.4 million or $5.88 per diluted common share, for the first six months of 2009. Net income, including net realized capital gains and losses, was $134.0 million, or $2.28 per diluted common share, for the first six months of 2010, compared to $381.1 million, or $6.19 per diluted common share, for the same period in 2009.

Commenting on the Company’s results, Chairman and Chief Executive Officer, Joseph V. Taranto said, “Although markets remain generally competitive, we have been able to selectively grow our business by focusing on those markets that present the best opportunities. We were pleased with the results generated this quarter and given our very well capitalized position, we continue to invest these earnings into buying back the Company’s shares at prices that we believe are very attractive. Since the beginning of the year, we have bought back almost 6% of the Company’s outstanding shares.”

Mr. Taranto added, “At December 31, 2010, I will retire as CEO. I will remain Chairman of the Board.  Ralph Jones will become CEO on January 1, 2011.  It has been an honor to

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work with many wonderful people at Everest to build the Company from a modest size in 1995 to the global company it is today with over $6 billion of capital.  The Board and I have great confidence that Ralph, and our team, will continue to effectively grow Everest in the future.”

Operating highlights for the second quarter of 2010 included the following:

·   Gross written premiums increased 4% to $1,013.5 million compared to the same period in 2009. Adjusting for the effects of foreign exchange, gross written premiums were up approximately 5%. Worldwide, reinsurance premiums increased 6% to $808.6 million with premium derived from the U.S. markets up 3% and the international markets up 9%. New business opportunities coupled with rate increases on select covers and insurance market growth in some international regions contributed to this increased volume. Insurance premiums were down 4% primarily due to underwriting actions that were taken in response to unprofitable business.

·   The loss ratio and combined ratio were 65.1% and 93.2%, respectively, for the quarter, compared to 59.2% and 87.5%, respectively, for the second quarter of 2009. Excluding $9.8 million of prior year favorable development and $69.7 million of catastrophe losses, which were primarily attributable to development on first quarter events, the current year attritional loss ratio was 59.0%, up from the 57.7% reported for last year’s second quarter.

·   Net investment income was down 1% to $165.7 million when compared to last year’s second quarter. Eliminating the impact of limited partnership investments on each quarter, investment income was up 2% in 2010 compared to the same period in 2009.

·   Net after-tax realized capital losses amounted to $28.1 million for the quarter compared to net after-tax realized capital gains of $16.3 million in the same period last year. The losses for the current quarter were primarily attributable to fair value adjustments on the equity portfolio.

·   Net after-tax unrealized capital gains increased $113.3 million during the quarter, primarily due to changes in interest rates.

·   Cash flow from operations was $221.5 million compared to $103.4 million for the same period in 2009. Much of the variance was attributable to a tax recovery in the current quarter whereas tax payments were made in the second quarter of 2009.

·   For the quarter, the annualized after-tax operating income1 return on average adjusted shareholders’ equity2 was 13.1% compared to 19.2% in 2009.

·   During the quarter, the Company repurchased 2.7 million of its common shares at an average price of $74.64 and a total cost of $200.1 million. For the year, the Company repurchased 3.2 million of its common shares, or 5.5% of its total outstanding shares at year end 2009, for a total cost of $247.1 million. The repurchases were made pursuant to a share repurchase authorization, provided by the Company’s Board of Directors, under which there remains 5.2 million shares available.

·   Shareholders’ equity ended the quarter at $6,036 million, down 1% from the $6,102 million at December 31, 2009. Adjusting for share repurchases and

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dividend payments, shareholder’s equity was up 4% from year end. Book value per share was $107.31 as of June 30, 2010 compared to $102.87 at December 31, 2009.

This news release contains forward-looking statements within the meaning of the U.S. federal securities laws.  We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in the U.S. Federal securities laws. These statements involve risks and uncertainties that could cause actual results to differ materially from those contained in forward-looking statements made on behalf of the Company.  These risks and uncertainties include the impact of general economic conditions and conditions affecting the insurance and reinsurance industry, the adequacy of our reserves, our ability to assess underwriting risk, trends in rates for property and casualty insurance and reinsurance, competition, investment market fluctuations, trends in insured and paid losses, catastrophes, regulatory and legal uncertainties and other factors described in our latest Annual Report on Form 10-K.  The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Everest Re Group, Ltd. is a Bermuda holding company that operates through the following subsidiaries: Everest Reinsurance Company provides reinsurance to property and casualty insurers in both the U.S. and international markets. Everest Reinsurance (Bermuda), Ltd., including through its branch in the United Kingdom, provides reinsurance and insurance to worldwide property and casualty markets and reinsurance to life insurers. Everest Reinsurance Company (Ireland), Limited provides reinsurance to non-life insurers in Europe. Everest National Insurance Company and Everest Security Insurance Company provide property and casualty insurance to policyholders in the U.S. Everest Indemnity Insurance Company offers excess and surplus lines insurance in the U.S. Additional information on Everest Re Group companies can be found at the Group& #8217;s web site at www.everestre.com.

A conference call discussing the second quarter results will be held at 10:30 a.m. Eastern Time on July 29, 2010. The call will be available on the Internet through the Company’s web site or at www.streetevents.com.

Recipients are encouraged to visit the Company’s web site to view supplemental financial information on the Company’s results. The supplemental information is located at www.everestre.com in the “Financial Reports” section of the “Investor Center”. The supplemental financial information may also be obtained by contacting the Company directly.

___________________________

1The Company generally uses after-tax operating income (loss), a non-GAAP financial measure, to evaluate its performance.  After-tax operating income (loss) consists of net income (loss) excluding after-tax net realized capital gains (losses) and after-tax gain on debt repurchase as the following reconciliation displays:

3 

	Three Months Ended										Six Months Ended
	June 30,										June 30,
(Dollars in thousands, except per share amounts)	2010						2009				2010				2009
	(unaudited)										(unaudited)
				Per Diluted					Per Diluted				Per Diluted					Per Diluted
				Common					Common				Common					Common
	Amount			Share			Amount		Share		Amount		Share		Amount			Share
Net income (loss)	$	156,673		$	2.70		$	272,588	$	4.43	$	134,021	$	2.28	$	381,144		$	6.19
After-tax net realized capital gains (losses)		(28,141	)		(0.48	)		16,343		0.27		23,000		0.39		(32,120	)		(0.52	)
After-tax gain on debt repurchase																50,876			0.83
After-tax operating income (loss)	$	184,814		$	3.18		$	256,245	$	4.16	$	111,021	$	1.89	$	362,388		$	5.88
(Some amounts may not reconcile due to rounding.)

Although net realized capital gains (losses) are an integral part of the Company’s insurance operations, the determination of net realized capital gains (losses) is independent of the insurance underwriting process.  The Company believes that the level of net realized capital gains (losses) for any particular period is not indicative of the performance of the underlying business in that particular period.  Providing only a GAAP presentation of net income (loss) makes it more difficult for users of the financial information to evaluate the Company’s success or failure in its basic business, and may lead to incorrect or misleading assumptions and conclusions.  The Company understands that the equity analysts who follow the Company focus on after-tax operating income (loss) in their analyses f or the reasons discussed above.  The Company provides after-tax operating income (loss) to investors so that they have what management believes to be a useful supplement to GAAP information concerning the Company’s performance.

2Adjusted shareholders’ equity excludes net after-tax unrealized (appreciation) depreciation of investments.

--Financial Details Follow--

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EVEREST RE GROUP, LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
	Three Months Ended						Six Months Ended
	June 30,						June 30,
(Dollars in thousands, except per share amounts)	2010			2009			2010			2009
	(unaudited)						(unaudited)
REVENUES:
Premiums earned	$	989,899		$	956,908		$	1,917,201		$	1,889,198
Net investment income		165,731			167,209			327,230			235,963
Net realized capital gains (losses):
Other-than-temporary impairments on fixed maturity securities		-			(4,936	)		-			(13,210	)
Other-than-temporary impairments on fixed maturity securities
transferred to other comprehensive income (loss)		-			-			-			-
Other net realized capital gains (losses)		(41,693	)		28,398			31,025			(28,465	)
Total net realized capital gains (losses)		(41,693	)		23,462			31,025			(41,675	)
Realized gain on debt repurchase		-			-			-			78,271
Net derivative gain (loss)		(22,304	)		21,351			(19,250	)		1,648
Other income (expense)		7,798			2,389			13,137			(2,791	)
Total revenues		1,099,431			1,171,319			2,269,343			2,160,614
CLAIMS AND EXPENSES:
Incurred losses and loss adjustment expenses		643,948			566,785			1,550,804			1,136,690
Commission, brokerage, taxes and fees		236,493			229,214			449,155			455,252
Other underwriting expenses		41,747			40,970			80,691			77,325
Corporate expenses		3,887			4,367			8,462			8,147
Interest, fees and bond issue cost amortization expense		13,016			17,116			29,658			37,258
Total claims and expenses		939,091			858,452			2,118,770			1,714,672
INCOME (LOSS) BEFORE TAXES		160,340			312,867			150,573			445,942
Income tax expense (benefit)		3,667			40,279			16,552			64,798
NET INCOME (LOSS)	$	156,673		$	272,588		$	134,021		$	381,144
Other comprehensive income (loss), net of tax		65,889			308,064			94,828			305,279
COMPREHENSIVE INCOME (LOSS)	$	222,562		$	580,652		$	228,849		$	686,423
EARNINGS PER COMMON SHARE:
Basic	$	2.70		$	4.44		$	2.29		$	6.21
Diluted		2.70			4.43			2.28			6.19
Dividends declared		0.48			0.48			0.96			0.96

EVEREST RE GROUP, LTD.
CONSOLIDATED BALANCE SHEETS
	June 30,			December 31,
(Dollars in thousands, except par value per share)	2010			2009
	(unaudited)
ASSETS:
Fixed maturities - available for sale, at market value	$	13,499,102		$	13,005,949
(amortized cost: 2010, $12,955,574; 2009, $12,614,742)
Fixed maturities - available for sale, at fair value		66,351			50,528
Equity securities - available for sale, at market value (cost: 2010, $12,574; 2009, $13,970)		15,173			16,301
Equity securities - available for sale, at fair value		367,093			380,025
Short-term investments		381,931			673,131
Other invested assets (cost: 2010, $581,392; 2009, $546,158)		581,013			545,284
Cash		191,453			247,598
Total investments and cash		15,102,116			14,918,816
Accrued investment income		154,372			158,886
Premiums receivable		968,205			978,847
Reinsurance receivables		652,912			636,375
Funds held by reinsureds		377,968			379,864
Deferred acquisition costs		370,832			362,346
Prepaid reinsurance premiums		118,285			108,029
Deferred tax asset		170,225			174,170
Federal income taxes recoverable		95,890			144,903
Other assets		196,071			139,076
TOTAL ASSETS	$	18,206,876		$	18,001,312
LIABILITIES:
Reserve for losses and loss adjustment expenses	$	9,237,813		$	8,937,858
Future policy benefit reserve		63,968			64,536
Unearned premium reserve		1,420,099			1,415,402
Funds held under reinsurance treaties		95,104			91,893
Losses in the course of payment		28,705			39,766
Commission reserves		42,425			55,579
Other net payable to reinsurers		50,822			53,014
Revolving credit borrowings		133,000			-
8.75% Senior notes due 3/15/2010		-			199,970
5.4% Senior notes due 10/15/2014		249,790			249,769
6.6% Long term notes due 5/1/2067		238,349			238,348
Junior subordinated debt securities payable		329,897			329,897
Accrued interest on debt and borrowings		4,892			9,885
Equity index put option liability		76,599			57,349
Other liabilities		199,814			156,324
Total liabilities		12,171,277			11,899,590
SHAREHOLDERS' EQUITY:
Preferred shares, par value: $0.01; 50 million shares authorized;
no shares issued and outstanding		-			-
Common shares, par value: $0.01; 200 million shares authorized; (2010) 66.0 million
and (2009) 65.8 million issued		660			658
Additional paid-in capital		1,853,158			1,845,181
Accumulated other comprehensive income (loss), net of deferred income tax expense
(benefit) of $107.4 million at 2010 and $101.0 million at 2009		366,866			272,038
Treasury shares, at cost; 9.8 million shares (2010) and 6.5 million shares (2009)		(830,037	)		(582,926	)
Retained earnings (deficit)		4,644,952			4,566,771
Total shareholders' equity		6,035,599			6,101,722
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	18,206,876		$	18,001,312

EVEREST RE GROUP, LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
	Three Months Ended						Six Months Ended
	June 30,						June 30,
(Dollars in thousands)	2010			2009			2010			2009
	(unaudited)						(unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	156,673		$	272,588		$	134,021		$	381,144
Adjustments to reconcile net income to net cash provided by operating activities:
Decrease (increase) in premiums receivable		2,624			(44,864	)		(5,135	)		(59,343	)
Decrease (increase) in funds held by reinsureds, net		(11,156	)		(21,004	)		(13,585	)		(30,785	)
Decrease (increase) in reinsurance receivables		(29,147	)		75,952			(62,291	)		43,815
Decrease (increase) in deferred tax asset		(11,853	)		9,228			(5,064	)		54,218
Increase (decrease) in reserve for losses and loss adjustment expenses		30,445			(181,592	)		449,390			(179,158	)
Increase (decrease) in future policy benefit reserve		(434	)		(2,013	)		(569	)		1,148
Increase (decrease) in unearned premiums		(28,341	)		(22,387	)		13,257			10,465
Change in equity adjustments in limited partnerships		(16,091	)		(19,809	)		(32,255	)		53,476
Change in other assets and liabilities, net		73,043			52,725			17,576			31,812
Non-cash compensation expense		3,589			3,620			7,130			6,756
Amortization of bond premium (accrual of bond discount)		10,454			4,391			21,339			6,881
Amortization of underwriting discount on senior notes		11			48			53			94
Realized gain on debt repurchase		-			-			-			(78,271	)
Net realized capital (gains) losses		41,693			(23,462	)		(31,025	)		41,675
Net cash provided by (used in) operating activities		221,510			103,421			492,842			283,927
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from fixed maturities matured/called - available for sale, at market value		369,775			318,283			783,165			560,413
Proceeds from fixed maturities matured/called - available for sale, at fair value		-			-			-			5,570
Proceeds from fixed maturities sold - available for sale, at market value		238,940			48,701			723,462			129,658
Proceeds from fixed maturities sold - available for sale, at fair value		6,115			4,510			8,612			8,002
Proceeds from equity securities sold - available for sale, at market value		712			34			712			1,076
Proceeds from equity securities sold - available for sale, at fair value		51,400			10,591			72,742			12,239
Distributions from other invested assets		19,630			10,647			30,360			23,311
Cost of fixed maturities acquired - available for sale, at market value		(938,124	)		(550,863	)		(1,961,623	)		(1,363,243	)
Cost of fixed maturities acquired - available for sale, at fair value		(9,486	)		(3,244	)		(23,680	)		(16,553	)
Cost of equity securities acquired - available for sale, at market value		(1,426	)		-			(1,426	)		-
Cost of equity securities acquired - available for sale, at fair value		(38,095	)		(10,320	)		(80,417	)		(19,299	)
Cost of other invested assets acquired		(10,034	)		(18,503	)		(37,078	)		(24,742	)
Net change in short-term investments		209,878			78,140			291,897			791,062
Net change in unsettled securities transactions		(58,493	)		49,629			(11,195	)		53,328
Net cash provided by (used in) investing activities		(159,208	)		(62,395	)		(204,469	)		160,822
CASH FLOWS FROM FINANCING ACTIVITIES:
Common shares issued during the period, net		128			256			849			388
Purchase of treasury shares		(200,079	)		(49,418	)		(247,111	)		(49,418	)
Revolving credit borrowings		133,000			-			133,000			-
Net cost of debt repurchase		-			-			-			(83,026	)
Net cost of senior notes maturing		-			-			(200,000	)		-
Dividends paid to shareholders		(27,556	)		(29,549	)		(55,840	)		(59,089	)
Net cash provided by (used in) financing activities		(94,507	)		(78,711	)		(369,102	)		(191,145	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH		9,499			42,737			24,584			13,002
Net increase (decrease) in cash		(22,706	)		5,052			(56,145	)		266,606
Cash, beginning of period		214,159			467,248			247,598			205,694
Cash, end of period	$	191,453		$	472,300		$	191,453		$	472,300
SUPPLEMENTAL CASH FLOW INFORMATION
Cash transactions:
Income taxes paid (recovered)	$	(48,597	)	$	40,644		$	(35,838	)	$	67,779
Interest paid		20,160			19,806			34,361			38,124