[PPT] - Alleghany Investor Presentation February 2020 I. Alleghany PowerPoint Presentation

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Alleghany

Investor Presentation February 2020

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I. Alleghany Overview

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“Conservatism dominates our management philosophy. We shun investment fads and fashions in favor of acquiring relatively few interests in basic financial, industrial and

ther enterprises that offer the

potential to deliver long-term value to our investors”

Own high-quality underwriting franchises

― Underwrite for profit ― Grow premiums only when market allows for profitable growth ― Consistently maintain appropriately conservative loss reserves

Invest for total return when risk/reward is

attractive

Acquire quality businesses at reasonable prices

― Provide resources, support and oversight to help them grow revenues, profits and returns

Maintain a conservative financial and operating

risk profile

Hold significant unrestricted liquidity for

potential opportunities (and downturns)

Our Management Approach

Philosophy Strategy 1 2 3 5 4

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A History of Investing in Successful Companies

Alleghany holding

company formed

Nickel Plate,

Chesapeake & Ohio, Erie and Pere Marquette Railroads (merged into Penn Central in 1968)

1929 1946 1949 1968 1974 1985 2003 1986 1995 2002 2012 2007 1991 1993 2013 2019

Investors Diversified Services (“IDS”) (sold to American Express in 1984) New York Central Railroad (merged into Penn Central in 1968) MSL Industries Jones Motor Company Chicago Title (spun off in 1998/1999) Shelby Insurance (sold in 1991) Underwriters Reinsurance Company (sold to Swiss Re in 2000) World Minerals (sold in 2005) Darwin Underwriters established (IPO in 2006 and sold in 2008) PacificComp (sold to CopperPoint in 2017) Alleghany Capital Corporation Roundwood (formerly Alleghany Capital Partners) Alleghany Asset Management (sold to ABN Amro in 2001)

2014 2015 2017 2018

Legacy Alleghany Current Alleghany / Logo

2008

SLIDE 5 5 509.2 555.9 324.0 100 200 300 400 500 600 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019

Indexed Total Return

Y BVPS Y Share Price S&P 500 (Total Return) CAGR 2019 Since '14 Since '09 Since '99 Y BVPS 15.8% 6.0% 7.8% 8.5% Y Share Price 28.3% 11.9% 11.8% 9.0% S&P 500 (Total Return) 31.5% 11.7% 13.5% 6.1%

Attractive And Consistent Return

Note: As of December 31, 2019. Compound annual growth rates (“CAGR”) for BVPS and Stock Price include the impact of $10 special dividend paid in 2018.

Continued Focus on BVPS Growth Long-term Conservative Orientation Quasi- autonomous Subsidiary Operating Model

Target Annual Growth in BVPS: 7% - 10%

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Modest Financial Leverage and Conservative Risk Profile

(1) Alleghany 2020 Senior Notes were redeemed on January 15, 2020. (2) Reflects net occurrence PML (after-tax) in a 1-in-250 year event (having a likelihood of being exceeded in any single year of 0.4 percent) for largest single zone peril (e.g. Northeast U.S. Wind for 2019). (3) Risk assets are defined as high yield bonds, below investment grade collateralized loan obligations and bank loans, publicly traded equity securities, private equity and partnership interests.

Debt to Capital Holding Company Liquidity Peak Zone PML / Shareholder Equity(2) Risk Assets / Shareholders’ Equity(3)

(millions)

19.4% 15.8% 15.6% 14.7% 17.5% 16.3% 2014 2015 2016 2017 2018 2019

Other Debt (ACC) Senior Notes

$1,032 $821 $1,047 $1,383 $1,122 $1,283 2014 2015 2016 2017 2018 2019 9% 10% 7% 8% 8% 8% 2014 2015 2016 2017 2018 2019 0.51x 0.52x 0.53x 0.62x 0.58x 0.39x 2014 2015 2016 2017 2018 2019

13.9% excl. 2020 notes (1)

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90 years as a public company (NYSE: Y)

$8.8 billion in book value
$11.9 billion equity market capitalization
$20.1 billion in total cash & investments
Baa1 senior debt rating from Moody’s
BBB+ senior debt rating from Standard & Poor’s
a- senior debt rating from A.M. Best

Alleghany Today

Notes: Financial data as of December 31, 2019 unless otherwise indicated. Market data as of February 14, 2020. (1) Contribution to 2019 adjusted earnings before interest and taxes, excluding corporate items. (2) Best’s Review March 2019 – Top 50 Global Reinsurers; ranking based on unaffiliated gross premiums written in 2018. (3) A.M. Best U.S. Surplus Lines – Segment Review, September 2019.

Reinsurance 46%(1) Insurance 29%(1) Investments

Alleghany Capital Corporation 25%(1) TransRe RSUI CapSpecialty

GAAP equity of $5.2

billion

Gross premiums

written of $4.5 billion

Top 15 global

reinsurer(2)

GAAP equity of $1.9

billion

Gross premiums written
f $1.4 billion
10th largest U.S. excess &

surplus lines group(3)

GAAP equity of $0.4

billion

Gross premiums written
f $0.4 billion
Focuses on niche

specialty commercial lines Asset Management

$15.8 billion fixed

income

$2.5 billion equity

portfolio

$0.6 billion other

invested assets Subsidiaries & Investments

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Capital Allocation as of December 31, 2019

Note: All subsidiaries are majority owned unless otherwise stated. Market data as of February 14, 2020. (1) Excludes $350 million par value senior notes at TransRe that mature in 2039. Also excludes $367 million of debt at Alleghany Capital (“ACC”). (2) Alleghany Capital expected to increase its ownership to over 90% during the first half of 2020. Wilbert will then be accounted for on a fully-consolidated basis. (3) Parent cash and marketable securities exclude cash at the TransRe holding company ($50 million at 12/31/2019), which is included in TransRe capital. (4) Primarily Alleghany parent deferred compensation and taxes, as well as ACC parent. amounts in millions, except book value per share

Consolidated: Alleghany Capital Operating Entities: Stockholders' Equity $ 8,777 89.8% W&W|AFCO Steel $ 255 2.6% Parent Company Debt(1) 994 10.2% Jazwares 235 2.4% Total Capital $ 9,771 100.0% Concord 109 1.1% Precision Cutting Technologies 105 1.1% Shares outstanding (mm) 14.36 Wilbert (45% investment)(2) 82 0.9% BVPS $ 611.00 Kentucky Trailer 81 0.8% Market Capitalization $ 11,878 IPS 67 0.7% Total Alleghany Capital $ 934 9.6% (Re)insurance: Other: TransRe $ 5,243 53.7% Parent cash and marketable securities(3) $ 1,233 12.6% RSUI 1,874 19.2% Stranded Oil 87 0.9% CapSpecialty 395 4.0% Alleghany Properties 24 0.2% AIHL Re 21 0.2% Other items, net(4) (40) (0.4%) Total (Re)insurance $ 7,533 77.1% Total Other $ 1,304 13.3%

SLIDE 9 9 Cumulative Results Over Holding Period Subsidiary / Acquisition Date Cash & Investments Stockholders’ Equity Years Held Net Premiums Written Underwriting Profits (Losses) Combined Ratio Net Dividends IRR

$13,804 2.6x $5,243 8 $29,130 $1,017 96.4% $1,592(1) 10.1% 3,829 2.0x 1,874 17 12,026 1,776 84.6 1,149 11.6 849 2.2x 395 18 3,523 (55) 101.6 130 5.5

Total (Re)insurance

$18,515(2) 2.5x 7,533(2)

($ in millions)

Current (Re)insurance Operations

Note: As of December 31, 2019. (1) Total dividends to Alleghany of $1,901 million less a $309 million capital contribution in 2014 primarily to repay senior notes. (2) Inclusive of AIHL Re.

March 6, 2012

July 1, 2003

January 1, 2002

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Consolidated Underwriting Results for Past 10 Years

Note: Underwriting profit is a non-GAAP financial measure. Refer to the appendix for further information.

Underwriting Profit Combined Ratio

2010-to-Date Underwriting Profits of $1.7 B and Combined Ratio of ~95.5%

$131 $50 $220 $421 $495 $467 $401 ($316) ($162) $33 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19

Pre- TransRe

83.0% 93.4% 94.1% 90.1% 88.8% 89.0% 91.9% 106.4% 103.2% 99.4% '10 '11 '12 '13 '14 '15 '16 '17 '18 '19

Pre- TransRe

95.5%

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TransRe – Structural Competitive Advantages

History of Prudently Navigating Market Conditions and Opportunities

Diversified, global reinsurer with casualty

& specialty expertise

Long-standing client and intermediary

relationships  70% proportional business  Leads or co-leads more than half

f its book
Strong balance sheet and infrastructure
Leveraging market position with third

party capital  Generates recurring fee income

TransRe has returned net dividends of

$1,592 million since acquisition and repaid $667 million in senior notes

Net Premiums Written(1)

(2019)

Net premiums written up 13%
Underwriting loss of $41mm
Profitability impacted by cat losses

relating to Typhoons Hagibis and Faxai

2019 Highlights

$3.8 billion(1)

(1) Excludes Farmers quota share treaty which contributed $691 million to net premiums written.

Business Overview

Personal Auto / Motor 15% Traditional Casualty 16% Professional Liability 15% Non- Catastrophe Property 20% Catastrophe Property 7% A&H 8% Guaranty 8% Marine & Energy 4% Aviation 2% Engineering 2% Other Specialty 3% Property 27% Casualty 46% Specialty 27%

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RSUI – Taking Advantage of Improving E&S Market

Continued New Business and Rate Momentum with Double Digit Renewal Rate Increases on Multiple Lines

Underwriting Profit

Cumulative Underwriting Profit: $1.8 billion

(Cumulative data for 2H 2003 – 2019 period)

30 years dedicated to wholesale specialty

insurance market – wholesale only

Proven ability to generate underwriting

profit and grow book value through cycles

Highly experienced underwriters
Nimble and reacts quickly to
pportunities
Proprietary, in-house developed

technology, models and analytical tools

Diversified profitable portfolio

Business Overview

Net premiums written up 18%
Combined ratio of 87.7%
Underwriting profit of $101mm

2019 Highlights

D&O Liability 7%

Professional Liability 22% General Liability 7% Umbrella / Excess 13% Property 50%

Alternative Structures 1%

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6%
3%

0% 3% 6% 9% 12% 15% Q1 '17 Q2 '17 Q3 '17 Q4 '17 Q1 '18 Q2 '18 Q3 '18 Q4 '18 Q1 '19 Q2 '19 Q3 '19 Q4 '19

Renewal Rate Change (%)

RSUI – Accelerating Rate Increases and Increasing Opportunity

Note: Data is quarterly rate and new business submission increases over prior-year quarter.

20%
10%

0% 10% 20% 30% 40% 50% Q1 '17 Q2 '17 Q3 '17 Q4 '17 Q1 '18 Q2 '18 Q3 '18 Q4 '18 Q1 '19 Q2 '19 Q3 '19 Q4 '19

New Business Submissions (Units)

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CapSpecialty – Repositioned for Greater Efficiency & Overall Profitability

Meaningful Progress Towards Its Goal of Becoming A Preferred Specialty Insurer for Small and Mid-Sized Businesses

Gross Premiums Written

$372 million

(2019)

Well-diversified specialty company
Niche product focus for small and mid-

size businesses

Recognized experts in select classes
Select distribution
Current focus on profitable growth,

expense management & technology

ptimization
New CEO, Jack Sennott appointed July 1,

2019

Business Overview

Net premiums written up 13%
Combined ratio of 108.4%; prior year

adverse development ($29 million)

9-point improvement in expense ratio

since 2014

2019 Highlights

Traditional Property & Casualty 25% Healthcare 23% Specialty Casualty 20% Professional Liability 17% Surety 15%

SLIDE 15 15 $1,002 $176 $465 $1,306 $10 $1,719 5.1% 0.9% 2.5% 6.8% 0.1% 8.9%

10.0%
5.0%

0.0% 5.0% 10.0% (500.0)

500.0

1,000.0 1,500.0 2,000.0 2,500.0 3,000.0 3,500.0 4,000.0 2014 2015 2016 2017 2018 2019 Net investment income Net realized gains(losses), net of OTTI Change in fair value - equitites Change in unrealized - fixed income Annualized return on average cash & invested assets

Investments Are a Significant Part of Our Earnings Power

(1) Excludes Alleghany Capital.

Portfolio Allocation Investment Leverage(1) Investment Results Pre-Tax

Avg. Credit

Quality of Debt Securities: AA-

Total: $20.1 billion

($ in millions)

Debt Securities 71% Equity Securities 13% Cash & Short-term 10% Commercial Mortgage Loans 3% Other Invested Assets 3% 2.73x 2.59x 2.55x 2.56x 2.72x 2.55x

2014 2015 2016 2017 2018 2019

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Alleghany Capital – Becoming a More Meaningful Contributor

(1) Adjusted earnings before income taxes (“Adjusted EBT”) represents noninsurance revenue less all operating expenses, and does not include: (i) amortization of intangible assets; (ii) change in the fair value of equity securities; (iii) net realized capital gains; (iv) other than temporary impairment ("OTTI") losses; and (v) income taxes. Excludes certain minor, legacy investments that were previously reflected in Alleghany Capital in 2018 and prior periods (2) ACC Share of Adjusted EBT calculated based on weighted average ownership percentages and includes Corporate Activity and Deal Expenses.

Diversified Portfolio of High-Performing Businesses Help Mitigate Individual Business Seasonality

Adjusted Earnings Before Tax(1) – 100% Basis Strategy

Be a long-term owner and

permanent capital provider to leading middle-market businesses

Partner with entrepreneurial

management teams / founders with high integrity, aligned through meaningful ownership interests

Acquire market leaders in niche

markets, or rapid share gainers in large fragmented markets

Accelerate operational efficiency

improvements; follow-on capital for growth / add-on acquisitions

ACC Ownership Share of Adjusted EBT(2): $16 $25 $38 $66 $112 $25 $43 $64 $93 $161 $19 $33 $50 $83 $143 2015 2016 2017 2018 2019

Corporate Activity & Deal Expenses Non-Industrial Industrial Adjusted EBT (Net of Corp. Activity & Deal Expenses) ($ millions)

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Company Description Founded Revenue(1) Acquired % Owned

Manufactures specialty machine

tools and, through DTI, supplies waterjet cutting consumables 1975 $39 2012 100%

Manufactures highly-engineered

custom trailers and truck bodies for a variety of niche markets 1879 $241 2013 77%

Fabricates and erects heavy

structural steel for bridges and large structures 1945 $826 2017 80%

Supplies products and services to

the funeral and precast concrete markets 1880 $179 2017 45%

Provides technical consulting for

the biopharmaceutical and other highly-complex manufacturing environments 1989 $646 2015 85%

Global toy, entertainment, and

musical instrument company 1997 $351 2016(3) 75%

Manages and develops hotels in

the U.S. and Canada 1985 $186 2018 85%

(1)

2019. Revenues are on 100% basis in $millions.

(2) Accounted for using equity method. Alleghany Capital expected to increase its ownership to over 90% during the first half of 2020. Wilbert will then be accounted for on a fully-consolidated basis. (3) 30% stake acquired in 2014, additional 50% acquired in 2016, 3% stake sold in Q1 2018, and 2% stake sold in Q4 2019.

Alleghany Capital - Platform Companies Industrial Non-Industrial

(2)

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Jazware’s 4th acquisition since Alleghany’s

investment

Deepens management talent
Adds iconic brands such as Pokémon and

Cabbage Patch Kids to an already impressive portfolio

Acquired animal feed transportation assets
Deepens market share in animal feed

transportation segment

Broadens geographic coverage

Alleghany Capital – 2019 Bolt-On Acquisitions

(1) Debt and equity.

Leading manufacturer of consumable

precision cutting tools

Stable, recurring source of revenue for PCT
Significantly expands IPS footprint in the

Northeast, a key biopharmaceutical hub

Adds highly experienced management

team, particularly in construction management Wicked Cool Toys (Oct-2019) Warren Manufacturing (Jul-2019) CID Performance Tooling (Jun-2019) The Cardinal Group (Apr-2019)

$250 Million of Capital(1) Deployed in 2019

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II. Macroeconomic & Industry Backdrop

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1) E&S market is firming

Significant competitors

retrenching

Changing view of certain risks

(e.g., wildfires, casualty inflation)

Limits contraction

2) Reinsurance market slowly improving 3) Opportunistic capital allocation 1) Late in economic cycle (elevated sovereign, corporate and household debt) 2) Geopolitical uncertainty (including trade) 3) Low return world 4) High asset prices (public and private) 5) Industry consolidation 6) Increasing loss cost trends / social inflation in casualty lines

Key Macroeconomic & Industry Themes

Opportunities Challenges 1 2 3 1 2 3 5 4 6

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Slowing U.S. & Global Growth

Source: World Bank. GDP growth (annual %) based on constant local currency and U.S. dollars for aggregates.

What Impact Will The Coronavirus Outbreak Have on Growth?

2.5% 1.8% 1.0% 5.7% (6.0)% (4.0)% (2.0)% 0.0% 2.0% 4.0% 6.0% 8.0% 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020E World United States European Union East Asia & Pacific

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Investment Environment Remains Challenging

Source: Bloomberg. Market data as of February 14, 2020.

Treasury Yields & Credit Spreads Is the S&P 500 Overpriced?

(20%) (10%) 0% 10% 20% 30% 2014 2015 2016 2017 2018 2019 Quarterly Earnings Growth 1.92% Slowing Growth 1.59% 1.25%

0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 2010 2012 2014 2016 2018 Yield / Spread UST 10Y BBB Credit Spreads

Jan 2018 - Feb 2020

0.0x 5.0x 10.0x 15.0x 20.0x 25.0x 30.0x 35.0x 2009 2011 2013 2015 2017 2019 Shiller P/E - S&P 500 32.3x

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Alleghany’s Tactical Response

Prudently manage underwriting risks
Reduction in emerging risks where future severity not reflected in current pricing (e.g., cyber)
Conservatism in property-cat opportunities where rate still not sufficient (e.g., Florida reinsurance)
Grow where significant rate, terms and conditions allow (Attritional Property, Umbrella / Excess, D&O,

Professional Liability)

Focus on aggregations and tail risk
De-risk investment portfolio
Reduced size of equity portfolio by more than half
Sold lower quality fixed income securities
Efficiently deploy capital
Allocate capital to ACC to support bolt-on acquisitions at existing portfolio companies
Return capital to shareholders
Potential to de-lever balance sheet over time; retired $300 million of debt in January 2020
Maintain sufficient dry powder for eventual opportunities
Significant holding company liquidity
Meaningful debt capacity

1 2 3 4

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III. Financial Performance

SLIDE 25 25 $4,489 $5,092 $4,966 $5,048 $5,752 2015 2016 2017 2018 2019 89.0% 91.9% 106.4% 103.2% 99.4% 2015 2016 2017 2018 2019 $7,555 $7,940 $8,514 $7,693 $8,777 2015 2016 2017 2018 2019

Alleghany Consolidated Performance

(1) Attributable to Alleghany common stockholders.

Net Premiums Written Combined Ratio Consolidated Net Income(1) Stockholders’ Equity(1)

($ in millions) ($ in millions) ($ in millions)

$221 $297 $(181) $561 $560 $457 $90 $40 $858 2015 2016 2017 2018 2019

Change in fair value of equities, after-tax Consolidated Net Income

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Key Takeaways

 Long-term focus with track record of consistent growth in book value

per share, despite significant headwinds over last 3 years

 TransRe and RSUI are strong franchises in their respective market

segments with improving outlook

 Alleghany Capital has achieved critical mass with prospect of improved

earnings contribution and double-digit return on equity

 Holding company conservatively capitalized with significant optionality  Reiterating long-term goal of 7 to 10% growth in book value per share

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Non-GAAP Financial Measures

This document and the remarks made during the presentation today may also contain non-GAAP financial measures. Reconciliations of these non-GAAP financial measures to the most direct comparable GAAP measures and related information are provided in our financial supplement and Form 10-K and 10-Q filings, which are available on our website at www.alleghany.com, and below. Adjusted Earnings Before Income Taxes Adjusted earnings before income taxes represents noninsurance revenue less all operating expenses, and does not include: (i) amortization of intangible assets; (ii) change in the fair value of equity securities; (iii) net realized capital gains; (iv) OTTI losses; and (vii) income taxes. Because adjusted earnings before income taxes excludes income taxes, change in the fair value of equity securities, net realized capital gains, OTTI losses and amortization of intangible assets, it provides an indication of economic performance that is not affected by investment activity, levels of effective tax rates or levels of amortization resulting from acquisition accounting. Alleghany uses adjusted earnings before income taxes as a supplement to earnings before income taxes, the most comparable GAAP financial measure, to evaluate the performance

f certain of its noninsurance operating subsidiaries and investments. A reconciliation of adjusted earnings before income

taxes to earnings before income taxes is presented on page 29 of the 4Q 2019 financial supplement. Underwriting Profit Underwriting profit represents net premiums earned less net loss and LAE and commissions, brokerage and other underwriting expenses, all as determined in accordance with GAAP, and does not include net investment income, net realized capital gains, OTTI losses, other revenue, other operating expenses, corporate administration, amortization of intangible assets and interest expense. Alleghany consistently uses underwriting profit as a supplement to earnings before income taxes, the most comparable GAAP financial measure, to evaluate the performance of its segments and believes that underwriting profit provides useful additional information to investors because it highlights net earnings attributable to a segment's underwriting performance. Earnings before income taxes may show a profit despite an underlying underwriting loss, and when underwriting losses persist over extended periods, a reinsurance or an insurance company's ability to continue as an ongoing concern may be at risk.