Also in attendance are Susan Cross, our Global Chief Actuary; Sarah Street, our Chief Investment Officer; and Steve Robb, our Controller.
Before they begin, I’d like to remind you that certain matters we'll discuss today are forward-looking statements. These statements are based on current plans, estimates and expectations. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in the forward-looking statements, and therefore, you should not place undue reliance on them.
Forward-looking statements are sensitive to many factors, including those identified in our annual report on Form 10-K, our quarterly reports on Form 10-Q and other documents on file with the SEC, that could cause actual results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date of which they are made, and we undertake no obligation publicly to revise any forward-looking statement in response to new information, future developments or otherwise.
With that, I'd turn it over to Mike McGavick.
Michael S. McGavick
As you can see from our release, XL's first quarter results were solid across the board. We returned to profitability in the first quarter with fully diluted operating earnings of $0.52 per ordinary share and an operating ROE of 6.9%. Following a difficult 2011, where much of our progress was obscured by the high level of catastrophes and large losses, this is a gratifying announcement to make and further supports our confidence in XL's days and years ahead.
In my year-end letter to shareholders, I outlined several reasons for our confidence. I'll go through some of these again, updating them with our first quarter results. First, our underwriting is improving. And look, we're not confused, we are not at the level of underwriting results that we are expecting to show in every business, but we are improving. The insurance segment combined ratio improved to 101.2%, obviously higher than it should be, but significantly better than the 121% in the first quarter of last year. And even when one removes the extreme cat events of last year, we saw margin expansion in the insurance results in first quarter last year over this year, and we expect that expansion to accelerate. At the same time, Reinsurance continued their record of achievement. The Reinsurance segment's combined ratio for the quarter was 82.4%, a great performance. Jamie will give further details momentarily. It's a good sign that these improvements were especially noticeable among the 7 challenged businesses and insurance that we've discussed in detail on prior calls. In fact, the combined ratio of these 7 businesses was, in this quarter, 104.3%, getting closer in line with the rest of our insurance book in this first quarter. Again, nowhere near good enough, but as we expected, moving in the right direction.