25 Janary 1999

Letter to shareholders

Dear Shareholders,

At the end of June 1998 we announced a series of measures with which Munich Re would be simplifying its share structure and also preparing its shares for the euro. With trading in only one category of Munich Re shares in future - fully paid-up no-par-value registered shares - and the split carried out today, our company's shares will be even more liquid and transparent, and thus even more attractive for investors.

The package of measures is now about to be completed: as explained below, we are offering the holders of our bearer shares the chance to convert their shares into registered shares and additionally, for each share converted, to subscribe for a further registered share at a price of DM 247 (= 126.29 euros) in a special rights issue. Given that the subscription price will be well below the current market price for Munich Re registered shares, this is a very attractive offer.

The requisite resolutions were adopted at the AGM on 5 November 1998. The other preconditions have now also been fulfilled, i.e.

• —
  the full paying-up of the registered shares, previously only partly paid up
• —
  the subsequent split of the registered shares
• —
  the conversion of the registered shares and bearer shares into no-par-value shares

It is now up to you to decide how you wish to proceed.

If you want to participate in the rights issue, you can subscribe for one new registered share for each bearer share at a price of DM 247 (126.29 euros). The envisaged subscription period is from 17 February up to and including 1 April 1999. There will be no trading of subscription rights. As proof of your subscription rights, you will need to submit your bearer shares with all unused coupons and talons (renewal coupons) via your bank to HypoVereinsbank, which will be handling the conversion. These bearer shares will be converted into registered shares, so that for each share subscribed for in the rights issue you will receive a further registered share resulting from the conversion of the bearer share. The registered share resulting from the conversion will be entitled to dividend as from the beginning of the short business year 1998, and each new registered share resulting from the rights issue will be entitled to dividend as from 1 January 1999. In order to achieve the highest possible conversion rate, the subscription period will last for six weeks and one day. For this relatively long period we have set three subscription dates - 3rd March, 17 March and 1 April 1999 (last subscription date) - so that depending on when you give your subscription order, you will receive the new registered shares and the registered shares resulting from the conversion at one of these three dates and will also have to pay the subscription price by that date.

If you do not want to participate in the rights issue or do not want to participate to the full extent, you can sell your subscription rights as follows. During the subscription period, envisaged for 17th February to 1 April 1999, you should submit your bearer shares with all the unused coupons and talons (renewal coupons) via your bank to HypoVereinsbank. These bearer shares will be converted into registered shares. The subscription rights apportionable to your bearer shares will be assumed and exercised by HypoVereinsbank. It will sell the shares deriving from these subscription rights at appropriate market conditions on the stock exchange. Depending on when you submit your bearer shares for conversion, the sale of your subscription rights - as described above - will take place following one of the three subscription dates: 3rd March, 17 March or 1 April 1999. In payment for your subscription rights, you will receive the average sales proceeds archieved in the respective sales period, less the issue price for the new shares and less sales costs incurred.

The conversion of your bearer shares will be free of charge for you. The banks will make the usual bank charges for the subscription of new registered shares in the rights issue.

You will shortly be receiving the details of the rights issue from your depositary bank and will be asked to give your instructions.

If you have any questions, please do no hesitate to call our service number in Germany (country code + 49) 1 80-2 22 62 10.

Yours sincerely,

Münchener Rückversicherungs-Gesellschaft