ACE LTD, 10-Q filed on 10/30/2013
Quarterly Report
Document and Entity Information
9 Months Ended
Sep. 30, 2013
Oct. 16, 2013
Entity Information [Line Items]
 
 
Document Type
10-Q 
 
Amendment Flag
false 
 
Document Period End Date
Sep. 30, 2013 
 
Document Fiscal Year Focus
2013 
 
Document Fiscal Period Focus
Q3 
 
Trading Symbol
ACE 
 
Entity Registrant Name
ACE Ltd 
 
Entity Central Index Key
0000896159 
 
Current Fiscal Year End Date
--12-31 
 
Entity Filer Category
Large Accelerated Filer 
 
Entity Common Stock, Shares Outstanding
 
340,065,071 
Consolidated Balance Sheets (USD $)
In Millions, unless otherwise specified
Sep. 30, 2013
Dec. 31, 2012
Assets
 
 
Fixed maturities available for sale, at fair value (amortized cost - $47,481 and $44,666) (includes hybrid financial instruments of $291 and $309)
$ 48,529 
$ 47,306 
Fixed maturities held to maturity, at amortized cost (fair value – $6,493 and $7,633)
6,306 
7,270 
Equity securities, at fair value (cost – $835 and $707)
831 
744 
Short-term investments, at fair value and amortized cost
1,774 
2,228 
Other investments (cost – $2,616 and $2,465)
2,902 
2,716 
Total investments
60,342 
60,264 
Cash
768 1 2
615 1 3
Securities lending collateral
1,517 
1,791 
Accrued investment income
563 
552 
Insurance and reinsurance balances receivable
5,089 
4,147 
Reinsurance recoverable on losses and loss expenses
11,477 
12,078 
Reinsurance recoverable on policy benefits
237 
241 
Deferred policy acquisition costs
2,224 
1,873 
Value of business acquired
554 
614 
Goodwill and other intangible assets
5,465 
4,975 
Prepaid reinsurance premiums
1,724 
1,617 
Deferred tax assets
584 
453 
Investments in partially-owned insurance companies (cost – $465 and $451)
468 
454 
Other assets
3,572 
2,871 
Total assets
94,584 
92,545 
Liabilities
 
 
Unpaid losses and loss expenses
37,882 
37,946 
Unearned premiums
7,794 
6,864 
Future policy benefits
4,596 
4,470 
Insurance and reinsurance balances payable
3,627 
3,472 
Securities lending payable
1,520 
1,795 
Accounts payable, accrued expenses, and other liabilities
4,917 
5,377 
Income taxes payable
12 
20 
Short-term debt
1,902 
1,401 
Long-term debt
3,807 
3,360 
Trust preferred securities
309 
309 
Total liabilities
66,366 
65,014 
Commitments and contingencies
   
   
Shareholders’ equity
 
 
Common Shares (CHF 27.49 and CHF 28.89 par value; 342,832,412 shares issued; 340,069,972 and 340,321,534 shares outstanding)
9,073 
9,591 
Common Shares in treasury (2,762,440 and 2,510,878 shares)
(222)
(159)
Additional paid-in capital
5,200 
5,179 
Retained earnings
12,793 
10,033 
Accumulated other comprehensive income (AOCI)
1,374 
2,887 
Total shareholders’ equity
28,218 
27,531 
Total liabilities and shareholders’ equity
$ 94,584 
$ 92,545 
Consolidated Balance Sheets (Parenthetical)
In Millions, except Share data, unless otherwise specified
Sep. 30, 2013
USD ($)
Sep. 30, 2013
CHF
Dec. 31, 2012
USD ($)
Dec. 31, 2012
CHF
Statement of Financial Position [Abstract]
 
 
 
 
Fixed maturities available for sale, at amortized cost
$ 47,481 
 
$ 44,666 
 
Fixed maturities available for sale, hybrid financial instruments
291 
 
309 
 
Fixed maturities held to maturity, at amortized cost
6,493 
 
7,633 
 
Equity securities, at cost
835 
 
707 
 
Other investments, cost
2,616 
 
2,465 
 
Investments in partially-owned insurance companies, cost
$ 465 
 
$ 451 
 
Common Shares, par value
 
 27.49 
 
 28.89 
Common Shares, shares issued
342,832,412 
342,832,412 
342,832,412 
342,832,412 
Common Shares, shares outstanding
340,069,972 
340,069,972 
340,321,534 
340,321,534 
Common Shares in treasury, shares
2,762,440 
2,762,440 
2,510,878 
2,510,878 
Consolidated Statements Of Operations and Comprehensive Income (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Revenues
 
 
 
 
Net premiums written
$ 4,620 
$ 4,716 
$ 12,809 
$ 12,418 
Change in unearned premiums
(10)
(51)
(559)
(589)
Net premiums earned
4,610 
4,665 
12,250 
11,829 
Net investment income
522 
533 
1,587 
1,614 
Net realized gains (losses):
 
 
 
 
Other-than-temporary impairment (OTTI) losses gross
(4)
(10)
(14)
(30)
Portion of OTTI losses recognized in other comprehensive income (OCI)
0 
0 
0 
0 
Net OTTI losses recognized in income
(4)
(10)
(14)
(30)
Net realized gains (losses) excluding OTTI losses
44 
(50)
364 
(164)
Total net realized gains (losses)
40 
(60)
350 
(194)
Total revenues
5,172 
5,138 
14,187 
13,249 
Expenses
 
 
 
 
Losses and loss expenses
2,655 
3,047 
6,831 
6,970 
Policy benefits
138 
130 
379 
379 
Policy acquisition costs
678 
609 
1,957 
1,810 
Administrative expenses
563 
519 
1,641 
1,543 
Interest expense
72 
63 
205 
187 
Other (income) expense
(5)
(17)
22 
14 
Total expenses
4,101 
4,351 
11,035 
10,903 
Income before income tax
1,071 
787 
3,152 
2,346 
Income tax expense (includes $4 and $16 Income tax expense from reclassification of unrealized gains in the three and nine months ended September 30, 2013, respectively)
155 
147 
392 
405 
Net income
916 
640 
2,760 
1,941 
Other comprehensive income (loss)
 
 
 
 
Unrealized appreciation (depreciation)
16 
731 
(1,570)
1,369 
Reclassification adjustment for net realized gains included in net income
24 
56 
97 
147 
Other comprehensive income
(8)
675 
(1,667)
1,222 
Change in:
 
 
 
 
Cumulative translation adjustment
149 
190 
(237)
162 
Pension liability
(2)
(4)
17 
(5)
Other comprehensive income (loss), before income tax
139 
861 
(1,887)
1,379 
Income tax (expense) benefit related to OCI items
(25)
(185)
374 
(276)
Other comprehensive income (loss)
114 
676 
(1,513)
1,103 
Comprehensive income
1,030 
1,316 
1,247 
3,044 
Earnings per share
 
 
 
 
Basic earnings per share
$ 2.68 
$ 1.88 
$ 8.09 
$ 5.71 
Diluted earnings per share
$ 2.66 
$ 1.86 
$ 8.02 
$ 5.67 
Reclassification out of Accumulated Other Comprehensive Income [Member] |
Accumulated Net Unrealized Investment Gain (Loss) [Member]
 
 
 
 
Net realized gains (losses):
 
 
 
 
Total net realized gains (losses)
24 
 
97 
 
Expenses
 
 
 
 
Income tax expense (includes $4 and $16 Income tax expense from reclassification of unrealized gains in the three and nine months ended September 30, 2013, respectively)
$ 4 
 
$ 16 
 
Consolidated Statements Of Operations and Comprehensive Income Consolidated Statements of Operations and Comprehensive Income (Parenthetical) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Net realized gains (losses)
$ 40 
$ (60)
$ 350 
$ (194)
Income tax expense (benefit)
155 
147 
392 
405 
Reclassification out of Accumulated Other Comprehensive Income [Member] |
Accumulated Net Unrealized Investment Gain (Loss) [Member]
 
 
 
 
Net realized gains (losses)
24 
 
97 
 
Income tax expense (benefit)
$ 4 
 
$ 16 
 
Consolidated Statements Of Shareholders' Equity (USD $)
In Millions
Total
Common Stock [Member]
Treasury Stock [Member]
Additional Paid-in Capital [Member]
Retained Earnings [Member]
Accumulated Net Unrealized Investment Gain (Loss) [Member]
Accumulated Translation Adjustment [Member]
Accumulated Defined Benefit Plans Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Member]
Balance - beginning of period at Dec. 31, 2011
 
$ 10,095 
$ (327)
$ 5,326 
$ 7,327 
$ 1,715 
$ 258 
$ (62)
 
Dividends declared on Common Shares-par value reduction
 
(336)
 
 
 
 
 
 
 
Common Shares repurchased
 
 
(7)
 
 
 
 
 
 
Net shares redeemed under employee share-based compensation plans
 
 
147 
(102)
 
 
 
 
 
Exercise of stock options
 
 
 
(8)
 
 
 
 
 
Share-based compensation expense and other
 
 
 
93 
 
 
 
 
 
Funding of dividends declared to Retained earnings
 
 
 
(200)
 
 
 
 
 
Net income
1,941 
 
 
 
1,941 
 
 
 
 
Funding of dividends declared from Additional paid-in capital
 
 
 
 
200 
 
 
 
 
Dividends declared on Common Shares
 
 
 
 
(200)
 
 
 
 
Change in period, net of income tax benefit (expense) of $353 and $(234)
 
 
 
 
 
988 
 
 
 
Change in period, net of income tax benefit (expense) of $27 and $(44)
 
 
 
 
 
 
118 
 
 
Change in period, net of income tax benefit (expense) of $(6) and $2
 
 
 
 
 
 
 
(3)
 
Balance - end of period at Sep. 30, 2012
26,963 
9,759 
(187)
5,109 
9,268 
2,703 
376 
(65)
3,014 
Balance - beginning of period at Dec. 31, 2012
27,531 
9,591 
(159)
5,179 
10,033 
2,633 
339 
(85)
 
Dividends declared on Common Shares-par value reduction
 
(518)
 
 
 
 
 
 
 
Common Shares repurchased
 
 
(233)
 
 
 
 
 
 
Net shares redeemed under employee share-based compensation plans
 
 
170 
(129)
 
 
 
 
 
Exercise of stock options
 
 
 
(34)
 
 
 
 
 
Share-based compensation expense and other
 
 
 
184 
 
 
 
 
 
Funding of dividends declared to Retained earnings
 
 
 
0 
 
 
 
 
 
Net income
2,760 
 
 
 
2,760 
 
 
 
 
Funding of dividends declared from Additional paid-in capital
 
 
 
 
0 
 
 
 
 
Dividends declared on Common Shares
 
 
 
 
0 
 
 
 
 
Change in period, before reclassification from AOCI, net of income tax benefit of $337
 
 
 
 
 
(1,233)
 
 
 
Amounts reclassified from AOCI, net of income tax benefit of $16
 
 
 
 
 
(81)
 
 
 
Change in period, net of income tax benefit (expense) of $353 and $(234)
 
 
 
 
 
(1,314)
 
 
 
Change in period, net of income tax benefit (expense) of $27 and $(44)
 
 
 
 
 
 
(210)
 
 
Change in period, net of income tax benefit (expense) of $(6) and $2
 
 
 
 
 
 
 
11 
 
Balance - end of period at Sep. 30, 2013
$ 28,218 
$ 9,073 
$ (222)
$ 5,200 
$ 12,793 
$ 1,319 
$ 129 
$ (74)
$ 1,374 
Consolidated Statements Of Shareholders' Equity (Parenthetical) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Net unrealized appreciation on investments, Change in period, income tax (expense) benefit
$ 353 
$ (234)
Cumulative translation adjustment, Change in period, income tax(expense) benefit
27 
(44)
Pension liability adjustment, Change in period, income tax (expense) benefit
(6)
2 
Accumulated Net Unrealized Investment Gain (Loss) [Member]
 
 
Unrealized appreciation on investments, Change in period before reclassification to AOCI, income tax (expense) benefit
(81)
 
Reclassification out of Accumulated Other Comprehensive Income [Member] |
Accumulated Net Unrealized Investment Gain (Loss) [Member]
 
 
Unrealized appreciation on investments, Change in period before reclassification to AOCI, income tax (expense) benefit
16 
 
Income tax expense from reclassification of unrealized gains
$ (337)
 
Consolidated Statements Of Cash Flows (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Cash flows from operating activities
 
 
Net income
$ 2,760 
$ 1,941 
Adjustments to reconcile net income to net cash flows from operating activities
 
 
Net realized (gains) losses
(350)
194 
Amortization of premiums/discounts on fixed maturities
207 
161 
Deferred income taxes
169 
46 
Unpaid losses and loss expenses
33 
430 
Unearned premiums
603 
708 
Future policy benefits
149 
109 
Insurance and reinsurance balances payable
163 
(174)
Accounts payable, accrued expenses, and other liabilities
(176)
252 
Income taxes payable
2 
44 
Insurance and reinsurance balances receivable
(657)
(828)
Reinsurance recoverable on losses and loss expenses
550 
606 
Reinsurance recoverable on policy benefits
6 
47 
Deferred policy acquisition costs
(391)
(260)
Prepaid reinsurance premiums
(69)
(115)
Other
(263)
(136)
Net cash flows from operating activities
2,736 
3,025 
Cash flows from investing activities
 
 
Purchases of fixed maturities available for sale
(15,835)
(17,348)
Purchases of to be announced mortgage-backed securities
(54)
(308)
Purchases of fixed maturities held to maturity
(374)
(217)
Purchases of equity securities
(217)
(114)
Sales of fixed maturities available for sale
7,982 
11,058 
Sales of to be announced mortgage-backed securities
30 
297 
Sales of equity securities
99 
57 
Maturities and redemptions of fixed maturities available for sale
5,538 
3,596 
Maturities and redemptions of fixed maturities held to maturity
1,233 
1,092 
Net derivative instruments settlements
(376)
(358)
Acquisition of subsidiaries (net of cash acquired of $38 and $8)
(977)
(98)
Other
(188)
(339)
Net cash flows used for investing activities
(3,139)
(2,682)
Cash flows from financing activities
 
 
Dividends paid on Common Shares
(343)
(484)
Common Shares repurchased
(233)
(11)
Proceeds from issuance of long-term debt
947 
0 
Proceeds from issuance of short-term debt
1,721 
2,083 
Repayment of short-term debt
(1,720)
(1,932)
Proceeds from share-based compensation plans, including windfall tax benefits
112 
73 
Other
68 
0 
Net cash flows from (used for) financing activities
552 
(271)
Effect of foreign currency rate changes on cash and cash equivalents
4 
4 
Net increase in cash
153 
76 
Cash – beginning of period
615 1 2
614 3
Cash – end of period
768 2 4
690 3
Supplemental cash flow information
 
 
Taxes paid
150 
323 
Interest paid
$ 169 
$ 156 
Consolidated Statements of Cash Flows (Parentheticals) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Statement of Cash Flows (Parentheticals) [Abstract]
 
 
Net cash acquired
$ 38 
$ 8 
General
General
General

Basis of presentation
ACE Limited is a holding company incorporated in Zurich, Switzerland. ACE Limited, through its various subsidiaries, provides a broad range of insurance and reinsurance products to insureds worldwide. ACE operates through the following business segments: Insurance – North American P&C, Insurance – North American Agriculture, Insurance – Overseas General, Global Reinsurance, and Life. Refer to Note 10 for additional information.

The interim unaudited consolidated financial statements, which include the accounts of ACE Limited and its subsidiaries (collectively, ACE, we, us, or our), have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and, in the opinion of management, reflect all adjustments (consisting of normally recurring accruals) necessary for a fair statement of the results and financial position for such periods. All significant intercompany accounts and transactions have been eliminated.

The results of operations and cash flows for any interim period are not necessarily indicative of the results for the full year. These consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in our 2012 Form 10-K.
Acquisitions
Acquisitions
Acquisitions

PT Asuransi Jaya Proteksi
We acquired 80 percent of PT Asuransi Jaya Proteksi (JaPro) on September 18, 2012 and our local partner acquired the remaining 20 percent on January 3, 2013. JaPro is one of Indonesia's leading general insurers. The total purchase price for 100 percent of the company was approximately $107 million in cash. JaPro operates in our Insurance – Overseas General segment.

Fianzas Monterrey
On April 1, 2013, we acquired Fianzas Monterrey, a leading surety lines company in Mexico offering administrative performance bonds primarily to clients in the construction and industrial sectors, for approximately $293 million in cash. This acquisition expands our global franchise in the surety business and enhances our existing commercial lines and personal accident insurance business in Mexico.

The acquisition generated $135 million of goodwill, attributable to expected growth and profitability, none of which is expected to be deductible for income tax purposes, and other intangible assets of $73 million, based on ACE's preliminary purchase price allocation. The other intangible assets primarily relate to customer lists. Amortization of other intangible assets is included in Other (income) expense in the consolidated statements of operations. Goodwill and other intangible assets arising from this acquisition are included in the Insurance – Overseas General segment.

ABA Seguros
On May 2, 2013, we acquired ABA Seguros, a property and casualty insurer in Mexico that provides automobile, homeowners, and small business coverages for approximately $690 million in cash.

The acquisition generated $283 million of goodwill, attributable to expected growth and profitability, none of which is expected to be deductible for income tax purposes, and other intangible assets of $140 million based on ACE’s preliminary purchase price allocation. The other intangible assets primarily relate to distribution channels. Amortization of other intangible assets is included in Other (income) expense in the consolidated statements of operations. Goodwill and other intangible assets arising from this acquisition are included in the Insurance – Overseas General segment.
Investments
Investments
Investments

a) Fixed maturities
The following tables present the amortized cost and fair value of fixed maturities and related OTTI recognized in AOCI:
 
September 30, 2013
Amortized
Cost

 
Gross
Unrealized
Appreciation

 
Gross
Unrealized
Depreciation

 
Fair
Value

 
OTTI Recognized
in AOCI

(in millions of U.S. dollars)
 
 
 
 
Available for sale
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency
$
2,934

 
$
81

 
$
(36
)
 
$
2,979

 
$
—

Foreign
14,294

 
405

 
(98
)
 
14,601

 
—

Corporate securities
16,664

 
753

 
(151
)
 
17,266

 
(6
)
Mortgage-backed securities
10,294

 
234

 
(149
)
 
10,379

 
(36
)
States, municipalities, and political subdivisions
3,295

 
72

 
(63
)
 
3,304

 
—

 
$
47,481

 
$
1,545

 
$
(497
)
 
$
48,529

 
$
(42
)
Held to maturity
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency
$
842

 
$
20

 
$
(3
)
 
$
859

 
$
—

Foreign
876

 
36

 
—

 
912

 
—

Corporate securities
1,960

 
87

 
—

 
2,047

 
—

Mortgage-backed securities
1,440

 
43

 
—

 
1,483

 
—

States, municipalities, and political subdivisions
1,188

 
19

 
(15
)
 
1,192

 
—

 
$
6,306

 
$
205

 
$
(18
)
 
$
6,493

 
$
—


December 31, 2012
Amortized
Cost

 
Gross
Unrealized
Appreciation

 
Gross
Unrealized
Depreciation

 
Fair
Value

 
OTTI Recognized
in AOCI

(in millions of U.S. dollars)
 
 
 
 
Available for sale
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency
$
3,553

 
$
183

 
$
(1
)
 
$
3,735

 
$
—

Foreign
13,016

 
711

 
(14
)
 
13,713

 
—

Corporate securities
15,529

 
1,210

 
(31
)
 
16,708

 
(7
)
Mortgage-backed securities
10,051

 
458

 
(36
)
 
10,473

 
(84
)
States, municipalities, and political subdivisions
2,517

 
163

 
(3
)
 
2,677

 
—

 
$
44,666

 
$
2,725

 
$
(85
)
 
$
47,306

 
$
(91
)
Held to maturity
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency
$
1,044

 
$
39

 
$
—

 
$
1,083

 
$
—

Foreign
910

 
54

 
—

 
964

 
—

Corporate securities
2,133

 
142

 
—

 
2,275

 
—

Mortgage-backed securities
2,028

 
88

 
—

 
2,116

 
—

States, municipalities, and political subdivisions
1,155

 
44

 
(4
)
 
1,195

 
—

 
$
7,270

 
$
367

 
$
(4
)
 
$
7,633

 
$
—


As discussed in Note 3 c), if a credit loss is indicated on an impaired fixed maturity, an OTTI is considered to have occurred and the portion of the impairment not related to credit losses (non-credit OTTI) is recognized in OCI. Included in the “OTTI Recognized in AOCI” columns above are the cumulative amounts of non-credit OTTI recognized in OCI adjusted for subsequent sales, maturities, and redemptions. OTTI recognized in AOCI does not include the impact of subsequent changes in fair value of the related securities. In periods subsequent to a recognition of OTTI in OCI, changes in the fair value of the related fixed maturities are reflected in Unrealized appreciation (depreciation) in the consolidated statement of shareholders’ equity. For the three and nine months ended September 30, 2013, $1 million of net unrealized depreciation and $24 million of net unrealized appreciation related to such securities is included in OCI. For the three and nine months ended September 30, 2012, $46 million and $130 million of net unrealized appreciation related to such securities is included in OCI. At September 30, 2013 and December 31, 2012, AOCI includes net unrealized depreciation of $4 million and $25 million, respectively, related to securities remaining in the investment portfolio at those dates for which ACE has recognized a non-credit OTTI.

Mortgage-backed securities (MBS) issued by U.S. government agencies are combined with all other to be announced mortgage derivatives held (refer to Note 7 a) (iv)) and are included in the category, “Mortgage-backed securities”. Approximately 84 percent and 85 percent, of the total mortgage-backed securities at September 30, 2013 and December 31, 2012, respectively are represented by investments in U.S. government agency bonds. The remainder of the mortgage exposure consists of collateralized mortgage obligations and non-government mortgage-backed securities, the majority of which provide a planned structure for principal and interest payments and carry a rating of AAA by the major credit rating agencies.

The following table presents fixed maturities by contractual maturity:
 
 
 
September 30

 
 
 
December 31

 
 
 
2013

 
 
 
2012

(in millions of U.S. dollars)
Amortized Cost

 
Fair Value

 
Amortized Cost

 
Fair Value

Available for sale
 
 
 
 
 
 
 
Due in 1 year or less
$
2,317

 
$
2,345

 
$
1,887

 
$
1,906

Due after 1 year through 5 years
13,978

 
14,450

 
13,411

 
14,010

Due after 5 years through 10 years
16,291

 
16,650

 
15,032

 
16,153

Due after 10 years
4,601

 
4,705

 
4,285

 
4,764

 
37,187

 
38,150

 
34,615

 
36,833

Mortgage-backed securities
10,294

 
10,379

 
10,051

 
10,473

 
$
47,481

 
$
48,529

 
$
44,666

 
$
47,306

Held to maturity
 
 
 
 
 
 
 
Due in 1 year or less
$
398

 
$
401

 
$
656

 
$
659

Due after 1 year through 5 years
2,335

 
2,417

 
1,870

 
1,950

Due after 5 years through 10 years
1,707

 
1,756

 
2,119

 
2,267

Due after 10 years
426

 
436

 
597

 
641

 
4,866

 
5,010

 
5,242

 
5,517

Mortgage-backed securities
1,440

 
1,483

 
2,028

 
2,116

 
$
6,306

 
$
6,493

 
$
7,270

 
$
7,633



Expected maturities could differ from contractual maturities because borrowers may have the right to call or prepay obligations, with or without call or prepayment penalties. 

b) Equity securities
The following table presents the cost and fair value of equity securities: 
 
September 30


December 31

(in millions of U.S. dollars)
2013


2012

Cost
$
835

 
$
707

Gross unrealized appreciation
53

 
41

Gross unrealized depreciation
(57
)
 
(4
)
Fair value
$
831

 
$
744



c) Net realized gains (losses)
In accordance with guidance related to the recognition and presentation of OTTI, when an impairment related to a fixed maturity has occurred, OTTI is required to be recorded in Net income if management has the intent to sell the security or it is more likely than not that we will be required to sell the security before the recovery of its amortized cost. Further, in cases where we do not intend to sell the security and it is more likely than not that we will not be required to sell the security, ACE must evaluate the security to determine the portion of the impairment, if any, related to credit losses. If a credit loss is indicated, an OTTI is considered to have occurred and any portion of the OTTI related to credit losses must be reflected in Net income while the portion of OTTI related to all other factors is recognized in OCI. For fixed maturities held to maturity, OTTI recognized in OCI is accreted from AOCI to the amortized cost of the fixed maturity prospectively over the remaining term of the securities.

Each quarter, securities in an unrealized loss position (impaired securities), including fixed maturities, securities lending collateral, equity securities, and other investments, are reviewed to identify impaired securities to be specifically evaluated for a potential OTTI.

For all non-fixed maturities, OTTI is evaluated based on the following:

•
the amount of time a security has been in a loss position and the magnitude of the loss position;

•
the period in which cost is expected to be recovered, if at all, based on various criteria including economic conditions and other issuer-specific developments; and

•
ACE’s ability and intent to hold the security to the expected recovery period.

As a general rule, we also consider that equity securities in an unrealized loss position for twelve consecutive months are other than temporarily impaired.

We review each fixed maturity in an unrealized loss position to assess whether the security is a candidate for credit loss. Specifically, we consider credit rating, market price, and issuer-specific financial information, among other factors, to assess the likelihood of collection of all principal and interest as contractually due. Securities for which we determine that credit loss is likely are subjected to further analysis to estimate the credit loss recognized in Net income, if any. In general, credit loss recognized in Net income equals the difference between the security’s amortized cost and the net present value of its projected future cash flows discounted at the effective interest rate implicit in the debt security. All significant assumptions used in determining credit losses are subject to change as market conditions evolve.

Projected cash flows for corporate securities (principally senior unsecured bonds) are driven primarily by assumptions regarding probability of default and also the timing and amount of recoveries associated with defaults. We develop these estimates using information based on market observable data, issuer-specific information, and credit ratings. ACE developed its default assumption by using historical default data by Moody’s Investors Service (Moody’s) rating category to calculate a 1-in-100 year probability of default, which results in a default assumption in excess of the historical mean default rate. We believe that use of a default assumption in excess of the historical mean is reasonable in light of current market conditions.

For the three and nine months ended September 30, 2013, credit losses recognized in Net income for corporate securities were $1 million and $8 million, respectively. For the three and nine months ended September 30, 2012, credit losses recognized in Net income for corporate securities were $5 million and $9 million, respectively.

For mortgage-backed securities, credit impairment is assessed using a cash flow model that estimates the cash flows on the underlying mortgages, using the security-specific collateral and transaction structure. The model estimates cash flows from the underlying mortgage loans and distributes those cash flows to various tranches of securities, considering the transaction structure and any subordination and credit enhancements that exist in that structure. The cash flow model incorporates actual cash flows on the mortgage-backed securities through the current period and then projects the remaining cash flows using a number of assumptions, including default rates, prepayment rates, and loss severity rates (the par value of a defaulted security that will not be recovered) on foreclosed properties.

For the three and nine months ended September 30, 2013, there were no credit losses recognized in Net income for mortgage-backed securities. For the three and nine months ended September 30, 2012, credit losses recognized in Net income for mortgage-backed securities were $2 million and $5 million, respectively.
The following table presents the Net realized gains (losses) and the losses included in Net realized gains (losses) and OCI as a result of conditions which caused us to conclude the decline in fair value of certain investments was “other-than-temporary”: 
 
Three Months Ended
 
 
Nine Months Ended
 
 
September 30
 
 
September 30
 
(in millions of U.S. dollars)
2013

 
2012

 
2013

 
2012

Fixed maturities:
 
 
 
 
 
 
 
OTTI on fixed maturities, gross
$
(4
)
 
$
(10
)
 
$
(11
)
 
$
(18
)
OTTI on fixed maturities recognized in OCI (pre-tax)
—

 
—

 
—

 
—

OTTI on fixed maturities, net
(4
)
 
(10
)
 
(11
)
 
(18
)
Gross realized gains excluding OTTI
37

 
71

 
163

 
287

Gross realized losses excluding OTTI
(16
)
 
(14
)
 
(68
)
 
(120
)
Total fixed maturities
17

 
47

 
84

 
149

Equity securities:
 
 
 
 
 
 
 
OTTI on equity securities
—

 
—

 
(1
)
 
(5
)
Gross realized gains excluding OTTI
8

 
3

 
18

 
5

Gross realized losses excluding OTTI
(1
)
 
(1
)
 
(4
)
 
(2
)
Total equity securities
7

 
2

 
13

 
(2
)
OTTI on other investments
—

 
—

 
(2
)
 
(7
)
Foreign exchange gains (losses)
(26
)
 
(50
)
 
45

 
(64
)
Investment and embedded derivative instruments
4

 
4

 
62

 
(3
)
Fair value adjustments on insurance derivative
134

 
83

 
563

 
44

S&P put options and futures
(95
)
 
(147
)
 
(413
)
 
(308
)
Other derivative instruments
(1
)
 
—

 
(2
)
 
(4
)
Other
—

 
1

 
—

 
1

Net realized gains (losses)
$
40

 
$
(60
)
 
$
350

 
$
(194
)

 
The following table presents a roll-forward of pre-tax credit losses related to fixed maturities for which a portion of OTTI was recognized in OCI: 
 
Three Months Ended
 
 
Nine Months Ended
 
 
September 30
 
 
September 30
 
(in millions of U.S. dollars)
2013

 
2012

 
2013

 
2012

Balance of credit losses related to securities still held – beginning of period
$
40

 
$
47

 
$
43

 
$
74

Additions where no OTTI was previously recorded
1

 
1

 
5

 
3

Additions where an OTTI was previously recorded
—

 
6

 
3

 
11

Reductions for securities sold during the period
(3
)
 
(4
)
 
(13
)
 
(38
)
Balance of credit losses related to securities still held – end of period
$
38

 
$
50

 
$
38

 
$
50



d) Gross unrealized loss
At September 30, 2013, there were 6,038 fixed maturities out of a total of 24,746 fixed maturities in an unrealized loss position. The largest single unrealized loss in the fixed maturities was $3 million. There were 66 equity securities out of a total of 183 equity securities in an unrealized loss position. The largest single unrealized loss in the equity securities was $48 million. Fixed maturities in an unrealized loss position at September 30, 2013 comprised both investment grade and below investment grade securities for which fair value declined primarily due to widening credit spreads since the date of purchase. Equity securities in an unrealized loss position at September 30, 2013 included foreign fixed income securities held in a commingled fund structure for which fair value declined primarily due to widening credit spreads since the date of purchase.

The following tables present, for all securities in an unrealized loss position (including securities on loan), the aggregate fair value and gross unrealized loss by length of time the security has continuously been in an unrealized loss position:
 
0 – 12 Months
 
 
Over 12 Months
 
 
Total
 
September 30, 2013
Fair Value

 
Gross
Unrealized
Loss

 
Fair Value

 
Gross
Unrealized
Loss

 
Fair Value

 
Gross
Unrealized
Loss

(in millions of U.S. dollars)
 
 
 
 
 
U.S. Treasury and agency
$
1,436

 
$
(39
)
 
$
—

 
$
—

 
$
1,436

 
$
(39
)
Foreign
4,034

 
(93
)
 
112

 
(5
)
 
4,146

 
(98
)
Corporate securities
4,696

 
(142
)
 
67

 
(9
)
 
4,763

 
(151
)
Mortgage-backed securities
3,751

 
(139
)
 
132

 
(10
)
 
3,883

 
(149
)
States, municipalities, and political subdivisions
2,076

 
(77
)
 
3

 
(1
)
 
2,079

 
(78
)
Total fixed maturities
15,993

 
(490
)
 
314

 
(25
)
 
16,307

 
(515
)
Equity securities
500

 
(57
)
 
—

 
—

 
500

 
(57
)
Other investments
40

 
(9
)
 
—

 
—

 
40

 
(9
)
Total
$
16,533

 
$
(556
)
 
$
314

 
$
(25
)
 
$
16,847

 
$
(581
)
 
 
0 – 12 Months
 
 
Over 12 Months
 
 
Total
 
December 31, 2012
Fair Value

 
Gross
Unrealized
Loss

 
Fair Value

 
Gross
Unrealized
Loss

 
Fair Value

 
Gross
Unrealized
Loss

(in millions of U.S. dollars)
 
 
 
 
 
U.S. Treasury and agency
$
440

 
$
(1
)
 
$
—

 
$
—

 
$
440

 
$
(1
)
Foreign
1,234

 
(8
)
 
88

 
(6
)
 
1,322

 
(14
)
Corporate securities
1,026

 
(23
)
 
85

 
(8
)
 
1,111

 
(31
)
Mortgage-backed securities
855

 
(4
)
 
356

 
(32
)
 
1,211

 
(36
)
States, municipalities, and political subdivisions
316

 
(3
)
 
48

 
(4
)
 
364

 
(7
)
Total fixed maturities
3,871

 
(39
)
 
577

 
(50
)
 
4,448

 
(89
)
Equity securities
29

 
(4
)
 
—

 
—

 
29

 
(4
)
Other investments
68

 
(5
)
 
—

 
—

 
68

 
(5
)
Total
$
3,968

 
$
(48
)
 
$
577

 
$
(50
)
 
$
4,545

 
$
(98
)


e) Restricted assets
ACE is required to maintain assets on deposit with various regulatory authorities to support its insurance and reinsurance operations. These requirements are generally promulgated in the statutory regulations of the individual jurisdictions. The assets on deposit are available to settle insurance and reinsurance liabilities. ACE is also required to restrict assets pledged under repurchase agreements. We also use trust funds in certain large reinsurance transactions where the trust funds are set up for the benefit of the ceding companies and generally take the place of letter of credit (LOC) requirements. We also have investments in segregated portfolios primarily to provide collateral or guarantees for LOCs and derivative transactions. Included in restricted assets at September 30, 2013 and December 31, 2012, are fixed maturities and short-term investments totaling $16.3 billion and $16.6 billion, respectively, and cash of $129 million and $139 million, respectively.

The following table presents the components of restricted assets:
 
September 30

 
December 31

(in millions of U.S. dollars)
2013

 
2012

Trust funds
$
11,269

 
$
11,389

Deposits with non-U.S. regulatory authorities
1,999

 
2,133

Assets pledged under repurchase agreements
1,405

 
1,401

Deposits with U.S. regulatory authorities
1,333

 
1,338

Other pledged assets
394

 
456

 
$
16,400

 
$
16,717

Fair value measurements
Fair value measurements
Fair value measurements

a) Fair value hierarchy
Fair value of financial assets and financial liabilities is estimated based on the framework established in the fair value accounting guidance. The guidance defines fair value as the price to sell an asset or transfer a liability in an orderly transaction between market participants and establishes a three-level valuation hierarchy in which inputs into valuation techniques used to measure fair value are classified. The fair value hierarchy gives the highest priority to quoted prices in active markets and the lowest priority to unobservable data.
 
The three levels of the hierarchy are as follows:

•
Level 1 – Unadjusted quoted prices for identical assets or liabilities in active markets;

•
Level 2 – Includes, among other items, inputs other than quoted prices that are observable for the asset or liability such as interest rates and yield curves, quoted prices for similar assets and liabilities in active markets, and quoted prices for identical or similar assets and liabilities in markets that are not active; and

•
Level 3 – Inputs that are unobservable and reflect management’s judgments about assumptions that market participants would use in pricing an asset or liability.

We categorize financial instruments within the valuation hierarchy at the balance sheet date based upon the lowest level of inputs that are significant to the fair value measurement. Accordingly, transfers between levels within the valuation hierarchy occur when there are significant changes to the inputs, such as increases or decreases in market activity, changes to the availability of current prices, changes to the transparency to underlying inputs, and whether there are significant variances in quoted prices. Transfers in and/or out of any level are assumed to occur at the end of the period.

We use one or more pricing services to obtain fair value measurements for the majority of the investment securities we hold. Based on management’s understanding of the methodologies used, these pricing services only produce an estimate of fair value if there is observable market information that would allow them to make a fair value estimate. Based on our understanding of the market inputs used by the pricing services, all applicable investments have been valued in accordance with GAAP. We do not typically adjust prices obtained from pricing services. The following is a description of the valuation techniques and inputs used to determine fair values for financial instruments carried at fair value, as well as the general classification of such financial instruments pursuant to the valuation hierarchy.

Fixed maturities
We use pricing services to estimate fair value measurements for the majority of our fixed maturities. The pricing services use market quotations for fixed maturities that have quoted prices in active markets; such securities are classified within Level 1. For fixed maturities other than U.S. Treasury securities that generally do not trade on a daily basis, the pricing services prepare estimates of fair value measurements using their pricing applications, which include available relevant market information, benchmark curves, benchmarking of like securities, sector groupings, and matrix pricing. Additional valuation factors that can be taken into account are nominal spreads, dollar basis, and liquidity adjustments. The pricing services evaluate each asset class based on relevant market and credit information, perceived market movements, and sector news. The market inputs used in the pricing evaluation, listed in the approximate order of priority include: benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, reference data, and industry and economic events. The extent of the use of each input is dependent on the asset class and the market conditions. Given the asset class, the priority of the use of inputs may change or some market inputs may not be relevant. Additionally, the valuation of fixed maturities is more subjective when markets are less liquid due to the lack of market based inputs (i.e., stale pricing), which may increase the potential that the estimated fair value of an investment is not reflective of the price at which an actual transaction would occur. The overwhelming majority of fixed maturities are classified within Level 2 because the most significant inputs used in the pricing techniques are observable. For a small number of fixed maturities, we obtain a quote from a broker (typically a market maker). Due to the disclaimers on the quotes that indicate that the price is indicative only, we include these fair value estimates in Level 3. 

Equity securities
Equity securities with active markets are classified within Level 1 as fair values are based on quoted market prices. For equity securities in markets which are less active, fair values are based on market valuations and are classified within Level 2. Equity securities for which pricing is unobservable are classified within Level 3.

Short-term investments
Short-term investments, which comprise securities due to mature within one year of the date of purchase that are traded in active markets, are classified within Level 1 as fair values are based on quoted market prices. Securities such as commercial paper and discount notes are classified within Level 2 because these securities are typically not actively traded due to their approaching maturity and, as such, their cost approximates fair value. Short-term investments for which pricing is unobservable are classified within Level 3.

Other investments
Fair values for the majority of Other investments including investments in partially-owned investment companies, investment funds, and limited partnerships are based on their respective net asset values or equivalent (NAV). The majority of these investments, for which NAV was used as a practical expedient to measure fair value, are classified within Level 3 because either ACE will never have the contractual option to redeem the investments or will not have the contractual option to redeem the investments in the near term. The remainder of such investments is classified within Level 2. Certain of our long duration contracts are supported by assets that do not qualify for separate account reporting under GAAP. These assets comprise mutual funds classified within Level 1 in the valuation hierarchy on the same basis as other equity securities traded in active markets. Other investments also includes equity securities and fixed maturities held in rabbi trusts maintained by ACE for deferred compensation plans, which are classified within the valuation hierarchy on the same basis as other equity securities and fixed maturities.

Securities lending collateral
The underlying assets included in Securities lending collateral in the consolidated balance sheets are fixed maturities which are classified in the valuation hierarchy on the same basis as other fixed maturities. Excluded from the valuation hierarchy is the corresponding liability related to ACE’s obligation to return the collateral plus interest as it is reported at contract value and not fair value in the consolidated balance sheets.

Investment derivative instruments
Actively traded investment derivative instruments, including futures, options, and exchange-traded forward contracts are classified within Level 1 as fair values are based on quoted market prices. The fair value of cross-currency swaps are based on market valuations and are classified within Level 2. Investment derivative instruments are recorded in Accounts payable, accrued expenses, and other liabilities in the consolidated balance sheets.

Other derivative instruments
We maintain positions in other derivative instruments including exchange-traded equity futures contracts and option contracts designed to limit exposure to a severe equity market decline, which would cause an increase in expected claims and, therefore, reserves for our guaranteed minimum death benefits (GMDB) and guaranteed living benefits (GLB) reinsurance business. Our position in exchange-traded equity futures contracts is classified within Level 1. The fair value of the majority of the remaining positions in other derivative instruments is based on significant observable inputs including equity security and interest rate indices. Accordingly, these are classified within Level 2. Our position in credit default swaps is typically included within Level 3. Other derivative instruments are recorded in Accounts payable, accrued expenses, and other liabilities in the consolidated balance sheets.

Separate account assets
Separate account assets represent segregated funds where investment risks are borne by the customers, except to the extent of certain guarantees made by ACE. Separate account assets comprise mutual funds classified in the valuation hierarchy on the same basis as other equity securities traded in active markets and are classified within Level 1. Separate account assets also include fixed maturities classified within Level 2 because the most significant inputs used in the pricing techniques are observable. Excluded from the valuation hierarchy are the corresponding liabilities as they are reported at contract value and not fair value in the consolidated balance sheets. Separate account assets are recorded in Other assets in the consolidated balance sheets.

Guaranteed living benefits
The GLB arises from life reinsurance programs covering living benefit guarantees whereby we assume the risk of guaranteed minimum income benefits (GMIB) and guaranteed minimum accumulation benefits (GMAB) associated with variable annuity contracts. GLB’s are recorded in Accounts payable, accrued expenses, and other liabilities and Future policy benefits in the consolidated balance sheets. For GLB reinsurance, ACE estimates fair value using an internal valuation model which includes current market information and estimates of policyholder behavior. All of the treaties contain claim limits, which are factored into the valuation model. The fair value depends on a number of inputs, including changes in interest rates, changes in equity markets, credit risk, current account value, changes in market volatility, expected annuitization rates, changes in policyholder behavior, and changes in policyholder mortality.

The most significant policyholder behavior assumptions include lapse rates and the GMIB annuitization rates. Assumptions regarding lapse rates and GMIB annuitization rates differ by treaty but the underlying methodologies to determine rates applied to each treaty are comparable. The assumptions regarding lapse and GMIB annuitization rates determined for each treaty are based on a dynamic calculation that uses several underlying factors.

A lapse rate is the percentage of in-force policies surrendered in a given calendar year. All else equal, as lapse rates increase, ultimate claim payments will decrease. In general, the base lapse function assumes low lapse rates (ranging from about 1 percent to 6 percent per annum) during the surrender charge period of the GMIB contract, followed by a “spike” lapse rate (ranging from about 10 percent to 30 percent per annum) in the year immediately following the surrender charge period, and then reverting to an ultimate lapse rate (generally around 10 percent per annum), typically over a 2-year period. This base rate is adjusted downward for policies with more valuable guarantees (policies with guaranteed values far in excess of their account values) by multiplying the base lapse rate by a factor ranging from 15 percent to 75 percent. Additional lapses due to partial withdrawals and older policyholders with tax-qualified contracts (due to required minimum distributions) are also included.

The GMIB annuitization rate is the percentage of policies for which the policyholder will elect to annuitize using the guaranteed benefit provided under the GMIB. All else equal, as GMIB annuitization rates increase, ultimate claim payments will increase, subject to treaty claim limits. In general ACE assumes that GMIB annuitization rates will be higher for policies with more valuable guarantees (policies with guaranteed values far in excess of their account values). In addition, we also assume that GMIB annuitization rates are higher in the first year immediately following the waiting period (the first year the policies are eligible to annuitize using the GMIB) in comparison to all subsequent years. We do not yet have a robust set of annuitization experience because most of our clients’ policyholders are not yet eligible to annuitize using the GMIB. However, for certain clients representing approximately 37 percent of the total GMIB guaranteed value there are several years of annuitization experience. For these clients the annuitization function reflects the actual experience and has a maximum annuitization rate per annum of 8 percent (a higher maximum applies in the first year a policy is eligible to annuitize using the GMIB—it is over 13 percent). For most clients, there is not a credible amount of observable relevant behavior data and so we use a weighted-average (with a heavier weighting on the observed experience noted previously) of three different annuitization functions with maximum annuitization rates per annum of 8 percent, 12 percent, and 30 percent, respectively (with significantly higher rates in the first year a policy is eligible to annuitize using the GMIB). The GMIB reinsurance treaties include claim limits to protect ACE in the event that actual annuitization behavior is significantly higher than expected.

The effect of changes in key market factors on assumed lapse and annuitization rates reflect emerging trends using data available from cedants. For treaties with limited experience, rates are established in line with data received from other ceding companies adjusted, as appropriate, with industry estimates. The model and related assumptions are continuously re-evaluated by management and enhanced, as appropriate, based upon additional experience obtained related to policyholder behavior and availability of more information, such as market conditions, market participant assumptions, and demographics of in-force annuities. During the three and nine months ended September 30, 2013, no material changes were made to actuarial or behavioral assumptions.

We view the variable annuity reinsurance business as having a similar risk profile to that of catastrophe reinsurance, with the probability of a cumulative long-term economic net loss relatively small at the time of pricing. However, adverse changes in market factors and policyholder behavior will have an adverse impact on net income, which may be material. Because of the significant use of unobservable inputs including policyholder behavior, GLB reinsurance is classified within Level 3.


The following tables present, by valuation hierarchy, the financial instruments measured at fair value on a recurring basis:
September 30, 2013
Level 1

 
Level 2

 
Level 3

 
Total

(in millions of U.S. dollars)
 
 
 
Assets:
 
 
 
 
 
 
 
Fixed maturities available for sale
 
 
 
 
 
 
 
U.S. Treasury and agency
$
1,615

 
$
1,364

 
$
—

 
$
2,979

Foreign
235

 
14,324

 
42

 
14,601

Corporate securities
1

 
17,144

 
121

 
17,266

Mortgage-backed securities
—

 
10,370

 
9

 
10,379

States, municipalities, and political subdivisions
—

 
3,304

 
—

 
3,304

 
1,851

 
46,506

 
172

 
48,529

Equity securities
375

 
452

 
4

 
831

Short-term investments
1,061

 
705

 
8

 
1,774

Other investments
292

 
221

 
2,389

 
2,902

Securities lending collateral
—

 
1,517

 
—

 
1,517

Investment derivative instruments
(18
)
 
—

 
—

 
(18
)
Other derivative instruments
7

 
8

 
—

 
15

Separate account assets
1,074

 
78

 
—

 
1,152

Total assets measured at fair value
$
4,642

 
$
49,487

 
$
2,573

 
$
56,702

Liabilities:
 
 
 
 
 
 
 
GLB(1)
$
—

 
$
—

 
$
514

 
$
514

(1) 
Our GLB reinsurance product meets the definition of a derivative instrument for accounting purposes and is accordingly carried at fair value. Excluded from the table above is the portion of the GLB derivative liability classified as Future policy benefits in the consolidated balance sheets. Refer to Note 5 for additional information.
 
December 31, 2012
Level 1

 
Level 2

 
Level 3

 
Total

(in millions of U.S. dollars)
 
 
 
Assets:
 
 
 
 
 
 
 
Fixed maturities available for sale
 
 
 
 
 
 
 
U.S. Treasury and agency
$
2,050

 
$
1,685

 
$
—

 
$
3,735

Foreign
222

 
13,431

 
60

 
13,713

Corporate securities
20

 
16,586

 
102

 
16,708

Mortgage-backed securities
—

 
10,460

 
13

 
10,473

States, municipalities, and political subdivisions
—

 
2,677

 
—

 
2,677

 
2,292

 
44,839

 
175

 
47,306

Equity securities
253

 
488

 
3

 
744

Short-term investments
1,503

 
725

 
—

 
2,228

Other investments
268

 
196

 
2,252

 
2,716

Securities lending collateral
—

 
1,791

 
—

 
1,791

Investment derivative instruments
11

 
—

 
—

 
11

Other derivative instruments
(6
)
 
30

 
—

 
24

Separate account assets
872

 
71

 
—

 
943

Total assets measured at fair value
$
5,193

 
$
48,140

 
$
2,430

 
$
55,763

Liabilities:
 
 
 
 
 
 
 
GLB(1)
$
—

 
$
—

 
$
1,119

 
$
1,119

(1) 
Our GLB reinsurance product meets the definition of a derivative instrument for accounting purposes and is accordingly carried at fair value. Excluded from the table above is the portion of the GLB derivative liability classified as Future policy benefits in the consolidated balance sheets. Refer to Note 5 for additional information.

There were no transfers from Level 1 to Level 2 during the the three months ended September 30, 2013. The transfers from Level 1 to Level 2 during the nine months ended September 30, 2013 were $19 million. The transfers from Level 1 to Level 2 were $34 million and $40 million during the three and nine months ended September 30, 2012, respectively. There were no transfers from Level 2 to Level 1 during the three and nine months ended September 30, 2013. The transfers from Level 2 to Level 1 during the three and nine months ended September 30, 2012 were $15 million.

Fair value of alternative investments
Included in Other investments in the fair value hierarchy at September 30, 2013 and December 31, 2012 are investment funds, limited partnerships, and partially-owned investment companies measured at fair value using NAV as a practical expedient. At September 30, 2013 and December 31, 2012, there were no probable or pending sales related to any of the investments measured at fair value using NAV. 

The following table presents, by investment category, the expected liquidation period, fair value, and maximum future funding commitments of alternative investments:
 
 
 
 
 
September 30

 
 
 
December 31

 
Expected
Liquidation
Period
 
 
 
2013

 
 
 
2012

(in millions of U.S. dollars)
Fair
Value

 
Maximum
Future Funding
Commitments

 
Fair
Value

 
Maximum
Future Funding
Commitments

Financial
5 to 9 Years
 
$
249

 
$
83

 
$
225

 
$
111

Real estate
3 to 9 Years
 
342

 
78

 
292

 
62

Distressed
6 to 9 Years
 
168

 
122

 
192

 
152

Mezzanine
6 to 9 Years
 
243

 
285

 
284

 
279

Traditional
3 to 8 Years
 
811

 
505

 
711

 
587

Vintage
1 to 3 Years
 
12

 
—

 
14

 
—

Investment funds
Not Applicable
 
415

 
—

 
395

 
—

 
 
 
$
2,240

 
$
1,073

 
$
2,113

 
$
1,191



Included in all categories in the above table except for Investment funds are investments for which ACE will never have the contractual option to redeem but receives distributions based on the liquidation of the underlying assets. Included in the “Expected Liquidation Period” column above is the range in years over which ACE expects the majority of underlying assets in the respective categories to be liquidated. Further, for all categories except for Investment funds, ACE does not have the ability to sell or transfer the investments without the consent from the general partner of individual funds.

Financial
Financial consists of investments in private equity funds targeting financial services companies such as financial institutions and insurance services around the world.

Real estate
Real estate consists of investments in private equity funds targeting global distress opportunities, value added U.S. properties, and global mezzanine debt securities in the commercial real estate market.

Distressed
Distressed consists of investments in private equity funds targeting distressed debt/credit and equity opportunities in the U.S.

Mezzanine
Mezzanine consists of investments in private equity funds targeting private mezzanine debt of large-cap and mid-cap companies in the U.S. and worldwide.

Traditional
Traditional consists of investments in private equity funds employing traditional private equity investment strategies such as buyout and venture with different geographical focuses including Brazil, Asia, Europe, and the U.S.

Vintage
Vintage consists of investments in private equity funds made before 2002 and where the funds’ commitment periods had already expired.

Investment funds
ACE’s investment funds employ various investment strategies such as long/short equity and arbitrage/distressed. Included in this category are investments for which ACE has the option to redeem at agreed upon value as described in each investment fund’s subscription agreement. Depending on the terms of the various subscription agreements, investment fund investments may be redeemed monthly, quarterly, semi-annually, or annually. If ACE wishes to redeem an investment fund investment, it must first determine if the investment fund is still in a lock-up period (a time when ACE cannot redeem its investment so that the investment fund manager has time to build the portfolio). If the investment fund is no longer in its lock-up period, ACE must then notify the investment fund manager of its intention to redeem by the notification date prescribed by the subscription agreement. Subsequent to notification, the investment fund can redeem ACE’s investment within several months of the notification. Notice periods for redemption of the investment funds range between 5 and 120 days. ACE can redeem its investment funds without consent from the investment fund managers.

Level 3 financial instruments
The fair value of assets and liabilities measured at fair value using significant unobservable inputs (Level 3) consist of various inputs and assumptions that management makes when determining fair value. Management analyzes changes in fair value measurements classified within Level 3 by comparing pricing and returns of our investments to benchmarks, including month-over-month movements, investment credit spreads, interest rate movements, and credit quality of securities.

The following table presents the significant unobservable inputs used in the Level 3 liability valuations. Excluded from the table below are inputs used to fair value Level 3 assets which are based on single broker quotes or net asset value and contain no quantitative unobservable inputs developed by management. 
(in millions of U.S. dollars, except for percentages)
Fair Value at
September 30, 2013

 
Fair Value at
December 31, 2012

 
Valuation
Technique
 
Significant
Unobservable Inputs
 
Ranges
GLB(1)
$
514

 
$
1,119

 
Actuarial model
 
Lapse rate
 
1% – 30%
 
 
 
 
 
 
 
Annuitization rate
 
0% – 50%
(1) 
Discussion of the most significant inputs used in the fair value measurement of GLB and the sensitivity of those assumptions is included within Note 4 a) Guaranteed living benefits.
The following tables present a reconciliation of the beginning and ending balances of financial instruments measured at fair value using significant unobservable inputs (Level 3): 
 
Assets
 
 
Liabilities

Three Months Ended
Available-for-Sale Debt Securities
Equity
securities

 
Short-term investments

 
Other
investments

 
GLB(1)

September 30, 2013
Foreign

 
Corporate
securities

 
MBS

 
 
(in millions of U.S. dollars)
 
 
 
 
Balance–Beginning of Period
$
48

 
$
114

 
$
9

 
$
4

 
$
9

 
$
2,349

 
$
652

Transfers into Level 3
1

 
12

 
—

 
—

 
1

 
—

 
—

Transfers out of Level 3
(8
)
 
(1
)
 
—

 
—

 
(2
)
 
—

 
—

Change in Net Unrealized Gains (Losses) included in OCI
2

 
(1
)
 
—

 
—

 
—

 
(1
)
 
—

Net Realized Gains/Losses
—

 
(1
)
 
—

 
—

 
—

 
—

 
(138
)
Purchases
12

 
6

 
—

 
—

 
—

 
138

 
—

Sales
(13
)
 
(4
)
 
—

 
—

 
—

 
(1
)
 
—

Settlements
—

 
(4
)
 
—

 
—

 
—

 
(96
)
 
—

Balance–End of Period
$
42

 
$
121

 
$
9

 
$
4

 
$
8

 
$
2,389

 
$
514

Net Realized Gains/Losses Attributable to Changes in Fair Value at the Balance Sheet Date
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
(138
)
(1) 
Our GLB reinsurance product meets the definition of a derivative instrument for accounting purposes and is accordingly carried at fair value. Excluded from the table above is the portion of the GLB derivative liability classified as Future policy benefits in the consolidated balance sheets. Refer to Note 5 for additional information.
  
Assets
 
 
Liabilities

 
Available-for-Sale Debt Securities
 
 
Equity
securities

 
Other
investments

 
Other
derivative
instruments

 
GLB(1)

Three Months Ended
U.S.
Treasury
and
Agency

 
Foreign

 
Corporate
securities

 
MBS

 
States,
municipalities,
and political
subdivisions

 
 
 
 
September 30, 2012
 
 
 
 
 
 
 
 
(in millions of U.S. dollars)
 
 
 
 
 
 
 
 
Balance–Beginning of Period
$
4

 
$
20

 
$
137

 
$
27

 
$
1

 
$
12

 
$
2,047

 
$
1

 
$
1,354

Transfers into Level 3
—

 
5

 
5

 
10

 
—

 
2

 
53

 
—

 
—

Transfers out of Level 3
(4
)
 
(6
)
 
(26
)
 
—

 
—

 
(10
)
 
—

 
—

 
—

Change in Net Unrealized Gains (Losses) included in OCI
—

 
—

 
3

 
—

 
—

 
(1
)
 
13

 
—

 
—

Net Realized Gains/Losses
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
(75
)
Purchases
—

 
6

 
11

 
—

 
—

 
1

 
121

 
—

 
—

Sales
—

 
—

 
—

 
(7
)
 
—

 
—

 
(5
)
 
—

 
—

Settlements
—

 
—

 
—

 
(1
)
 
—

 
—

 
(51
)
 
(1
)
 
—

Balance–End of Period
$
—

 
$
25

 
$
130

 
$
29

 
$
1

 
$
4

 
$
2,178

 
$
—

 
$
1,279

Net Realized Gains/Losses Attributable to Changes in Fair Value at the Balance Sheet Date
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
(75
)
(1) 
Our GLB reinsurance product meets the definition of a derivative instrument for accounting purposes and is accordingly carried at fair value. Excluded from the table above is the portion of the GLB derivative liability classified as Future policy benefits in the consolidated balance sheets. The liability for GLB reinsurance was $1.5 billion at September 30, 2012, and $1.6 billion at June 30, 2012, which includes a fair value derivative adjustment of $1.3 billion and $1.4 billion, respectively.

 
Assets
Liabilities

Nine Months Ended
Available-for-Sale Debt Securities
Equity
securities

 
Short-term investments

 
Other
investments

 
GLB(1)

 
Foreign

 
Corporate
securities

 
MBS

 
 
 
September 30, 2013
 
 
 
 
 
(in millions of U.S. dollars)
 
 
 
 
 
Balance–Beginning of Period
$
60

 
$
102

 
$
13

 
$
3

 
$
—

 
$
2,252

 
$
1,119

Transfers into Level 3
33

 
29

 
—

 
7

 
8

 
—

 
—

Transfers out of Level 3
(49
)
 
(30
)
 
—

 
(1
)
 
(2
)
 
—

 
—

Change in Net Unrealized Gains (Losses) included in OCI
(2
)
 
(1
)
 
—

 
(5
)
 
—

 
34

 
—

Net Realized Gains/Losses
1

 
(2
)
 
—

 
4

 
—

 
(2
)
 
(605
)
Purchases
15

 
39

 
—

 
1

 
2

 
387

 
—

Sales
(15
)
 
(4
)
 
(3
)
 
(5
)
 
—

 
(10
)
 
—

Settlements
(1
)
 
(12
)
 
(1
)
 
—

 
—

 
(272
)
 
—

Balance–End of Period
$
42

 
$
121

 
$
9

 
$
4

 
$
8

 
$
2,389

 
$
514

Net Realized Gains/Losses Attributable to Changes in Fair Value at the Balance Sheet Date
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
(2
)
 
$
(605
)
(1) 
Our GLB reinsurance product meets the definition of a derivative instrument for accounting purposes and is accordingly carried at fair value. Excluded from the table above is the portion of the GLB derivative liability classified as Future policy benefits in the consolidated balance sheets. Refer to Note 5 for additional information.
  
Assets
 
 
Liabilities

 
Available-for-Sale Debt Securities
 
 
Equity
securities

 
Other
investments

 
Other
derivative
instruments

 
GLB(1)

Nine Months Ended
U.S.
Treasury
and
Agency

 
Foreign

 
Corporate
securities

 
MBS

 
States,
municipalities,
and political
subdivisions

 
 
 
 
September 30, 2012
 
 
 
 
 
 
 
 
(in millions of U.S. dollars)
 
 
 
 
 
 
 
 
Balance–Beginning of Period
$
5

 
$
33

 
$
134

 
$
28

 
$
1

 
$
13

 
$
1,877

 
$
3

 
$
1,319

Transfers into Level 3
—

 
6

 
33

 
22

 
1

 
2

 
53

 
—

 
—

Transfers out of Level 3
(4
)
 
(7
)
 
(35
)
 
(15
)
 
—

 
(10
)
 
—

 
—

 
—

Change in Net Unrealized Gains (Losses) included in OCI
—

 
—

 
6

 
—

 
—

 
—

 
37

 
—

 
—

Net Realized Gains/Losses
—

 
—

 
(1
)
 
—

 
—

 
—

 
(7
)
 
(4
)
 
(40
)
Purchases
—

 
46

 
19

 
4

 
—

 
4

 
366

 
3

 
—

Sales
—

 
(52
)
 
(15
)
 
(7
)
 
—

 
(5
)
 
(6
)
 
—

 
—

Settlements
(1
)
 
(1
)
 
(11
)
 
(3
)
 
(1
)
 
—

 
(142
)
 
(2
)
 
—

Balance–End of Period
$
—

 
$
25

 
$
130

 
$
29

 
$
1

 
$
4

 
$
2,178

 
$
—

 
$
1,279

Net Realized Gains/Losses Attributable to Changes in Fair Value at the Balance Sheet Date
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
(7
)
 
$
—

 
$
(40
)
(1) 
Our GLB reinsurance product meets the definition of a derivative instrument for accounting purposes and is accordingly carried at fair value. Excluded from the table above is the portion of the GLB derivative liability classified as Future policy benefits in the consolidated balance sheets. The liability for GLB reinsurance was $1.5 billion at September 30, 2012 and December 31, 2011, which includes a fair value derivative adjustment of $1.3 billion.

b) Financial instruments disclosed, but not measured, at fair value
ACE uses various financial instruments in the normal course of its business. Our insurance contracts are excluded from fair value of financial instruments accounting guidance, and therefore, are not included in the amounts discussed below.

The carrying values of cash, other assets, other liabilities, and other financial instruments not included below approximated their fair values.

Investments in partially-owned insurance companies
Fair values for investments in partially-owned insurance companies are based on ACE’s share of the net assets based on the financial statements provided by those companies.

Short- and long-term debt and trust preferred securities
Where practical, fair values for short-term debt, long-term debt, and trust preferred securities are estimated using discounted cash flow calculations based principally on observable inputs including incremental borrowing rates, which reflect ACE’s credit rating, for similar types of borrowings with maturities consistent with those remaining for the debt being valued.

The following tables present fair value, by valuation hierarchy, and carrying value of the financial instruments not measured at fair value:
September 30, 2013
Fair Value
 
 
Carrying Value

(in millions of U.S. dollars)
Level 1

 
Level 2

 
Level 3

 
Total

 
Assets:
 
 
 
 
 
 
 
 
 
Fixed maturities held to maturity
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency
$
615

 
$
244

 
$
—

 
$
859

 
$
842

Foreign
—

 
912

 
—

 
912

 
876

Corporate securities
—

 
2,031

 
16

 
2,047

 
1,960

Mortgage-backed securities
—

 
1,483

 
—

 
1,483

 
1,440

States, municipalities, and political subdivisions
—

 
1,192

 
—

 
1,192

 
1,188

 
615

 
5,862

 
16

 
6,493

 
6,306

Partially-owned insurance companies
—

 
—

 
468

 
468

 
468

Total assets
$
615

 
$
5,862

 
$
484

 
$
6,961

 
$
6,774

Liabilities:
 
 
 
 
 
 
 
 
 
Short-term debt
$
—

 
$
1,920

 
$
—

 
$
1,920

 
$
1,902

Long-term debt
—

 
4,146

 
—

 
4,146

 
3,807

Trust preferred securities
—

 
441

 
—

 
441

 
309

Total liabilities
$
—

 
$
6,507

 
$
—

 
$
6,507

 
$
6,018


December 31, 2012
Fair Value
 
 
Carrying Value

(in millions of U.S. dollars)
Level 1

 
Level 2

 
Level 3

 
Total

 
Assets:
 
 
 
 
 
 
 
 
 
Fixed maturities held to maturity
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency
$
619

 
$
464

 
$
—

 
$
1,083

 
$
1,044

Foreign
—

 
964

 
—

 
964

 
910

Corporate securities
—

 
2,257

 
18

 
2,275

 
2,133

Mortgage-backed securities
—

 
2,116

 
—

 
2,116

 
2,028

States, municipalities, and political subdivisions
—

 
1,195

 
—

 
1,195

 
1,155

 
619

 
6,996

 
18

 
7,633

 
7,270

Partially-owned insurance companies
—

 
—

 
454

 
454

 
454

Total assets
$
619

 
$
6,996

 
$
472

 
$
8,087

 
$
7,724

Liabilities:
 
 
 
 
 
 
 
 
 
Short-term debt
$
—

 
$
1,401

 
$
—

 
$
1,401

 
$
1,401

Long-term debt
—

 
3,916

 
—

 
3,916

 
3,360

Trust preferred securities
—

 
446

 
—

 
446

 
309

Total liabilities
$
—

 
$
5,763

 
$
—

 
$
5,763

 
$
5,070

Assumed life reinsurance programs involving minimum benefit guarantees under annuity contracts
Assumed life reinsurance programs involving minimum benefit guarantees under annuity contracts
Assumed life reinsurance programs involving minimum benefit guarantees under annuity contracts

The following table presents income and expenses relating to GMDB and GLB reinsurance. GLBs include GMIBs as well as some GMABs originating in Japan.
 
Three Months Ended
 
 
Nine Months Ended
 
 
September 30
 
 
September 30
 
(in millions of U.S. dollars)
2013

 
2012

 
2013

 
2012

GMDB
 
 
 
 
 
 
 
Net premiums earned
$
19

 
$
20

 
$
59

 
$
64

Policy benefits and other reserve adjustments
$
14

 
$
22

 
$
58

 
$
61

GLB
 
 
 
 
 
 
 
Net premiums earned
$
36

 
$
40

 
$
112

 
$
121

Policy benefits and other reserve adjustments
9

 
7

 
20

 
30

Net realized gains (losses)
138

 
75

 
608

 
41

Gain recognized in income
$
165

 
$
108

 
$
700

 
$
132

Net cash received
$
31

 
$
35

 
$
94

 
$
114

Net decrease in liability
$
134

 
$
73

 
$
606

 
$
18



At September 30, 2013, reported liabilities for GMDB and GLB reinsurance were $95 million and $746 million, respectively, compared with $90 million and $1.4 billion, respectively, at December 31, 2012. The reported liability of $746 million for GLB reinsurance at September 30, 2013 and $1.4 billion at December 31, 2012 includes a fair value derivative adjustment of $514 million and $1.1 billion, respectively. Included in Net realized gains (losses) in the table above are gains (losses) related to foreign exchange and other fair value derivative adjustments. Reported liabilities for both GMDB and GLB reinsurance are determined using internal valuation models. Such valuations require considerable judgment and are subject to significant uncertainty. The valuation of these products is subject to fluctuations arising from, among other factors, changes in interest rates, changes in equity markets, changes in credit markets, changes in the allocation of the investments underlying annuitants’ account values, and assumptions regarding future policyholder behavior. These models and the related assumptions are continually reviewed by management and enhanced, as appropriate, based upon improvements in modeling assumptions and availability of more information, such as market conditions and demographics of in-force annuities.

Variable Annuity Net Amount at Risk
(i) Reinsurance covering the GMDB risk only
At September 30, 2013 and December 31, 2012, the net amount at risk from reinsurance programs covering the GMDB risk only was $751 million and $1.3 billion, respectively.

For reinsurance programs covering the GMDB risk only, the net amount at risk is defined as the present value of future claim payments under the following assumptions:

•
policy account values and guaranteed values are fixed at the valuation date (September 30, 2013 and December 31, 2012, respectively);

•
there are no lapses or withdrawals;

•
mortality according to 100 percent of the Annuity 2000 mortality table;

•
future claims are discounted in line with the discounting assumption used in the calculation of the benefit reserve averaging between 1.5 percent and 2.5 percent; and

•
reinsurance coverage ends at the earlier of the maturity of the underlying variable annuity policy or the reinsurance treaty.

The total claim amount payable on reinsurance programs covering the GMDB risk only, if all the cedants’ policyholders were to die immediately at September 30, 2013 was approximately $618 million. This takes into account all applicable reinsurance treaty claim limits.

(ii) Reinsurance covering the GLB risk only
At September 30, 2013 and December 31, 2012, the net amount at risk from reinsurance programs covering the GLB risk only was $220 million and $445 million, respectively.

For reinsurance programs covering the GLB risk only, the net amount at risk is defined as the present value of future claim payments under the following assumptions:

•
policy account values and guaranteed values are fixed at the valuation date (September 30, 2013 and December 31, 2012, respectively);

•
there are no deaths, lapses, or withdrawals;

•
policyholders annuitize at a frequency most disadvantageous to ACE (in other words, annuitization at a level that maximizes claims taking into account the treaty limits) under the terms of the reinsurance contracts;

•
for annuitizing policyholders, the GMIB claim is calculated using interest rates in line with those used in calculating the reserve;

•
future claims are discounted in line with the discounting assumption used in the calculation of the benefit reserve averaging between 3.5 percent and 4.5 percent; and

•
reinsurance coverage ends at the earlier of the maturity of the underlying variable annuity policy or the reinsurance treaty. 

(iii) Reinsurance covering both the GMDB and GLB risks on the same underlying policyholders
At September 30, 2013 and December 31, 2012, the GMDB net amount at risk from reinsurance programs covering both the GMDB and GLB risks on the same underlying policyholders was $85 million and $116 million, respectively.

At September 30, 2013 and December 31, 2012, the GLB net amount at risk from reinsurance programs covering both the GMDB and GLB risks on the same underlying policyholders was $241 million and $655 million, respectively.

These net amounts at risk reflect the interaction between the two types of benefits on any single policyholder (eliminating double-counting), and therefore the net amounts at risk should be considered additive.

For reinsurance programs covering both the GMDB and GLB risks on the same underlying policyholders, the net amount at risk is defined as the present value of future claim payments under the following assumptions:

•
policy account values and guaranteed values are fixed at the valuation date (September 30, 2013 and December 31, 2012, respectively);

•
there are no lapses, or withdrawals;

•
mortality according to 100 percent of the Annuity 2000 mortality table;

•
policyholders annuitize at a frequency most disadvantageous to ACE (in other words, annuitization at a level that maximizes claims taking into account the treaty limits) under the terms of the reinsurance contracts;

•
for annuitizing policyholders, the GMIB claim is calculated using interest rates in line with those used in calculating the reserve;

•
future claims are discounted in line with the discounting assumption used in the calculation of the benefit reserve averaging between 2.5 percent and 3.5 percent; and

•
reinsurance coverage ends at the earlier of the maturity of the underlying variable annuity policy or the reinsurance treaty.

The total claim amount payable on reinsurance programs covering both the GMDB and GLB risks on the same underlying policyholders, if all of the cedants’ policyholders were to die immediately at September 30, 2013 was approximately $199 million million. This takes into account all applicable reinsurance treaty claim limits. Although there would be an increase in death claims resulting from 100 percent immediate mortality of all policyholders, the GLB claims would be zero.

The average attained age of all policyholders under sections i), ii), and iii) above, weighted by the guaranteed value of each reinsured policy, is approximately 68 years.
Debt
Debt
Debt

In March 2013, ACE INA Holdings, Inc. issued $475 million of 2.70 percent senior notes due March 2023 and $475 million of 4.15 percent senior notes due March 2043.  The 2.70 percent senior notes and 4.15 percent senior notes are redeemable at any time at ACE INA Holdings, Inc.'s option subject to a “make-whole” premium (the present value of the remaining principal and interest discounted at the applicable U.S. Treasury rate plus 0.10 percent and 0.15 percent, respectively). The notes are also redeemable at par plus accrued and unpaid interest in the event of certain changes in tax law. These notes do not have the benefit of any sinking fund.  These senior unsecured notes are guaranteed on a senior basis by ACE Limited and they rank equally with all of ACE's other senior obligations.  They also contain customary limitations on lien provisions as well as customary events of default provisions which, if breached, could result in the accelerated maturity of such senior debt.

In June 2013, we reclassified $500 million of 5.875 percent senior notes, due to mature on June 15, 2014, from Long-term debt to Short-term debt in the consolidated balance sheet.
Commitments, contingencies, and guarantees
Commitments, contingencies, and guarantees
Commitments, contingencies, and guarantees

a) Derivative instruments
Derivative instruments employed
ACE maintains positions in derivative instruments such as futures, options, swaps, and foreign currency forward contracts for which the primary purposes are to manage duration and foreign currency exposure, yield enhancement, or to obtain an exposure to a particular financial market. Along with convertible bonds and to be announced mortgage-backed securities (TBA), discussed below, these are the most numerous and frequent derivative transactions.

ACE maintains positions in convertible bond investments that contain embedded derivatives. In addition, ACE, from time to time, purchases TBAs as part of its investing activities. These securities are included within the fixed maturities available for sale (FM AFS) portfolio.

Under reinsurance programs covering GLBs, ACE assumes the risk of GLBs, including GMIB and GMAB, associated with variable annuity contracts. The GMIB risk is triggered if, at the time the contract holder elects to convert the accumulated account value to a periodic payment stream (annuitize), the accumulated account value is not sufficient to provide a guaranteed minimum level of monthly income. The GMAB risk is triggered if, at contract maturity, the contract holder’s account value is less than a guaranteed minimum value. The GLB reinsurance product meets the definition of a derivative instrument. Benefit reserves in respect of GLBs are classified as Future policy benefits (FPB) while the fair value derivative adjustment is classified within Accounts payable, accrued expenses, and other liabilities (AP). ACE also maintains positions in exchange-traded equity futures contracts and options on equity market indices to limit equity exposure in the GMDB and GLB blocks of business.

In relation to certain debt issuances, ACE, from time to time, enters into interest rate swap transactions for the purpose of either fixing or reducing borrowing costs. Although the use of these interest rate swaps has the economic effect of fixing or reducing borrowing costs on a net basis, gross interest expense on the related debt issuances is included in Interest expense while the settlements related to the interest rate swaps are reflected in Net realized gains (losses) in the consolidated statements of operations. At September 30, 2013, ACE had no in-force interest rate swaps.

ACE, from time to time, buys credit default swaps to mitigate global credit risk exposure, primarily related to reinsurance recoverables. At September 30, 2013, ACE had no in-force credit default swaps.

All derivative instruments are carried at fair value with changes in fair value recorded in Net realized gains (losses) in the consolidated statements of operations. None of the derivative instruments are designated as hedges for accounting purposes.

The following table presents the balance sheet locations, fair values in an asset or (liability) position, and notional values/payment provisions of our derivative instruments:
 
 
 
September 30
 
 
December 31
 
 
 
 
2013
 
 
2012
 
(in millions of U.S. dollars)
Consolidated
Balance Sheet
Location
 
Fair
Value

 
Notional
Value/
Payment
Provision

 
Fair
Value

 
Notional
Value/
Payment
Provision

Investment and embedded derivative instruments
 
 
 
 
 
 
 
 
 
Foreign currency forward contracts
AP
 
$
(7
)
 
$
1,205

 
$
—

 
$
620

Cross-currency swaps
AP
 
—

 
50

 
—

 
50

Futures contracts on money market instruments
AP
 
2

 
3,910

 
1

 
2,710

Futures contracts on notes and bonds
AP
 
(13
)
 
1,022

 
10

 
915

Convertible bonds
FM AFS
 
291

 
242

 
309

 
279

TBAs
FM AFS
 
25

 
24

 
—

 
—

 
 
 
$
298

 
$
6,453

 
$
320

 
$
4,574

Other derivative instruments
 
 
 
 
 
 
 
 
 
Futures contracts on equities(1)
AP
 
$
7

 
$
1,585

 
$
(6
)
 
$
2,308

Options on equity market indices(1)
AP
 
10

 
250

 
30

 
250

Other
AP
 
(2
)
 
13

 
—

 
—

 
 
 
$
15

 
$
1,848

 
$
24

 
$
2,558

GLB(2)
AP/FPB
 
$
(746
)
 
$
461

 
$
(1,352
)
 
$
1,100

(1) 
Related to GMDB and GLB blocks of business.
(2) 
Includes both future policy benefits reserves and fair value derivative adjustment. Refer to Note 5 for additional information. Note that the payment provision related to GLB is the net amount at risk. The concept of a notional value does not apply to the GLB reinsurance contracts.

On January 1, 2013, we adopted new guidance that requires disclosure of financial instruments subject to a master netting agreement.  At September 30, 2013 and December 31, 2012, derivative liabilities of $1 million and derivative assets of $35 million, respectively, included in the table above were subject to a master netting agreement.  The remaining derivatives included in the table above were not subject to a master netting agreement. 

At September 30, 2013 and December 31, 2012, our repurchase obligations of $1,402 million and $1,401 million, respectively, were fully collateralized.  At September 30, 2013 and December 31, 2012, our securities lending payable was $1,520 million and $1,795 million, respectively, and our securities lending collateral was $1,517 million and $1,791 million, respectively.  The securities lending collateral can only be accessed in the event that the institution borrowing the securities is in default under the lending agreement.  An indemnification agreement with the lending agent protects us in the event a borrower becomes insolvent or fails to return any of the securities on loan.  In contrast to securities lending programs, the use of cash received is not restricted for the repurchase obligations.

The following table presents Net realized gains (losses) related to derivative instrument activity in the consolidated statements of operations:
 
Three Months Ended
 
 
Nine Months Ended
 
 
September 30
 
 
September 30
 
(in millions of U.S. dollars)
2013

 
2012

 
2013

 
2012

Investment and embedded derivative instruments
 
 
 
 
 
 
 
Foreign currency forward contracts
$
(9
)
 
$
(9
)
 
$
8

 
$
(8
)
All other futures contracts and options
6

 
—

 
46

 
(20
)
Convertible bonds
6

 
12

 
7

 
24

TBAs
1

 
1

 
1

 
1

Total investment and embedded derivative instruments
$
4

 
$
4

 
$
62

 
$
(3
)
GLB and other derivative instruments
 
 
 
 
 
 
 
GLB(1)
$
134

 
$
83

 
$
563

 
$
44

Futures contracts on equities(2)
(90
)
 
(138
)
 
(393
)
 
(286
)
Options on equity market indices(2)
(5
)
 
(9
)
 
(20
)
 
(22
)
Other
(1
)
 
—

 
(2
)
 
(4
)
Total GLB and other derivative instruments
$
38

 
$
(64
)
 
$
148

 
$
(268
)
 
$
42

 
$
(60
)
 
$
210

 
$
(271
)
(1) 
Excludes foreign exchange gains (losses) related to GLB.
(2) 
Related to GMDB and GLB blocks of business. 

Derivative instrument objectives

(i) Foreign currency exposure management
A foreign currency forward contract (forward) is an agreement between participants to exchange specific foreign currencies at a future date. ACE uses forwards to minimize the effect of fluctuating foreign currencies.

(ii) Duration management and market exposure
Futures
Futures contracts give the holder the right and obligation to participate in market movements, determined by the index or underlying security on which the futures contract is based. Settlement is made daily in cash by an amount equal to the change in value of the futures contract times a multiplier that scales the size of the contract. Exchange-traded futures contracts on money market instruments, notes and bonds are used in fixed maturity portfolios to more efficiently manage duration, as substitutes for ownership of the money market instruments, bonds and notes without significantly increasing the risk in the portfolio. Investments in futures contracts may be made only to the extent that there are assets under management not otherwise committed.

Exchange-traded equity futures contracts are used to limit exposure to a severe equity market decline, which would cause an increase in expected claims and therefore, reserves for GMDB and GLB reinsurance business.

Options
An option contract conveys to the holder the right, but not the obligation, to purchase or sell a specified amount or value of an underlying security at a fixed price. Option contracts are used in the investment portfolio as protection against unexpected shifts in interest rates, which would affect the duration of the fixed maturity portfolio. By using options in the portfolio, the overall interest rate sensitivity of the portfolio can be reduced. Option contracts may also be used as an alternative to futures contracts in the synthetic strategy as described above.

Another use for option contracts is to limit exposure to a severe equity market decline, which would cause an increase in expected claims and therefore, reserves for GMDB and GLB reinsurance business.

The price of an option is influenced by the underlying security, expected volatility, time to expiration, and supply and demand.

The credit risk associated with the above derivative financial instruments relates to the potential for non-performance by counterparties. Although non-performance is not anticipated, in order to minimize the risk of loss, management monitors the creditworthiness of its counterparties and obtains collateral. The performance of exchange-traded instruments is guaranteed by the exchange on which they trade. For non-exchange-traded instruments, the counterparties are principally banks which must meet certain criteria according to our investment guidelines.

Cross-currency swaps
Cross-currency swaps are agreements under which two counterparties exchange interest payments and principal denominated in different currencies at a future date.  We use cross-currency swaps to reduce the foreign currency and interest rate risk by converting cash flows back into local currency.  We invest in foreign currency denominated investments to improve credit diversification and also to obtain better duration matching to our liabilities that is limited in the local currency market.

Other
Included within Other are derivatives intended to reduce potential losses which may arise from certain exposures in our insurance business.  The economic benefit provided by these derivatives is similar to purchased reinsurance.  For example, from time to time, ACE may enter into derivative contracts to protect underwriting results in the event of a significant decline in commodity prices.  Also included within Other are credit default swaps purchased and certain life insurance products that meet the definition of a derivative instrument for accounting purposes. 

(iii) Convertible security investments
A convertible bond is a debt instrument that can be converted into a predetermined amount of the issuer’s equity at certain times prior to the bond’s maturity. The convertible option is an embedded derivative within the fixed maturity host instruments which are classified in the investment portfolio as available for sale. ACE purchases convertible bonds for their total return and not specifically for the conversion feature.

(iv) TBA
By acquiring TBAs, we make a commitment to purchase a future issuance of mortgage-backed securities. For the period between purchase of the TBAs and issuance of the underlying security, we account for our position as a derivative in the consolidated financial statements. ACE purchases TBAs both for their total return and for the flexibility they provide related to our mortgage-backed security strategy.

(v) GLB
Under the GLB program, as the assuming entity, ACE is obligated to provide coverage until the expiration or maturity of the underlying deferred annuity contracts or the expiry of the reinsurance treaty. Premiums received under the reinsurance treaties are classified as premium. Expected losses allocated to premiums received are classified as Future policy benefits and valued similar to GMDB reinsurance. Other changes in fair value, principally arising from changes in expected losses allocated to expected future premiums, are classified as Net realized gains (losses). Fair value represents management’s estimate of exit price and thus, includes a risk margin. We may recognize a realized loss for other changes in fair value due to adverse changes in the capital markets (e.g., declining interest rates and/or declining equity markets) and changes in actual or estimated future policyholder behavior (e.g., increased annuitization or decreased lapse rates) although we expect the business to be profitable. We believe this presentation provides the most meaningful disclosure of changes in the underlying risk within the GLB reinsurance programs for a given reporting period.

b) Other investments
At September 30, 2013, included in Other investments in the consolidated balance sheet are investments in limited partnerships and partially-owned investment companies with a carrying value of $1,825 million. In connection with these investments, we have commitments that may require funding of up to $1,073 million over the next several years. 

c) Taxation
In April 2012, ACE reached final settlement with the Internal Revenue Service (IRS) Appeals Division regarding several issues raised by the IRS Examination Division in its federal tax returns for 2005, 2006 and 2007. The settlement of these issues had no net impact on our results of operations. In addition, the IRS completed its field examination of ACE’s federal tax returns for 2008 and 2009 during June 2012. No material adjustments resulted from this examination. During the nine months ended September 30, 2013, ACE reduced the amount of unrecognized tax benefits by $5 million resulting from the closing of applicable statutes of limitations. As of September 30, 2013, $24 million of unrecognized tax benefits remains outstanding. It is reasonably possible that over the next twelve months, the amount of unrecognized tax benefits may change resulting from the re-evaluation of unrecognized tax benefits arising from examinations of taxing authorities. With few exceptions, ACE is no longer subject to state and local or non-U.S. income tax examinations for years before 2005.

d) Legal proceedings
Claims and other litigation
Our insurance subsidiaries are subject to claims litigation involving disputed interpretations of policy coverages and, in some jurisdictions, direct actions by allegedly-injured persons seeking damages from policyholders. These lawsuits, involving claims on policies issued by our subsidiaries which are typical to the insurance industry in general and in the normal course of business, are considered in our loss and loss expense reserves. In addition to claims litigation, we are subject to lawsuits and regulatory actions in the normal course of business that do not arise from or directly relate to claims on insurance policies. This category of business litigation typically involves, among other things, allegations of underwriting errors or misconduct, employment claims, regulatory activity, or disputes arising from our business ventures. In the opinion of management, our ultimate liability for these matters could be, but we believe is not likely to be, material to our consolidated financial condition and results of operations.
Shareholders' equity
Shareholders' equity
Shareholders’ equity

All of ACE’s Common Shares are authorized under Swiss corporate law. Though the par value of Common Shares is stated in Swiss francs, ACE continues to use U.S. dollars as its reporting currency for preparing the consolidated financial statements. Under Swiss corporate law, dividends, including distributions through a reduction in par value (par value reduction) or from legal reserves, must be stated in Swiss francs though dividend payments are made by ACE in U.S. dollars. At our May 2011 annual general meeting, our shareholders approved a dividend for the following year, payable in four quarterly installments after the May 2011 annual general meeting from our capital contribution reserves (Additional paid-in capital), a subaccount of legal reserves. At our May 2012 and May 2013 annual general meetings, our shareholders approved a dividend for the following year, respectively, payable in four quarterly installments after the annual general meetings in the form of a distribution by way of a par value reduction. We have determined this procedure is more appropriate for us at this time due to current Swiss law. For the three and nine months ended September 30, 2013, dividends per Common Share amounted to CHF 0.46 ($0.51) and CHF 1.40 ($1.51), respectively. Par value reductions have been reflected as such through Common Shares in the consolidated statements of shareholders' equity and had the effect of reducing par value per Common Share to CHF 27.49 at September 30, 2013.

For the three and nine months ended September 30, 2012, dividends per Common Share amounted to CHF 0.45 ($0.49) and CHF 1.46 ($1.57), respectively, which included a $0.12 per Common Share increase (approved by our shareholders at the January 9, 2012 extraordinary general meeting) to the third and fourth installments of the dividend approved at the May 2011 annual general meeting. For the nine months ended September 30, 2012, dividends per Common Share included a par value reduction of CHF 0.93 per Common Share.

Common Shares in treasury are used principally for issuance upon the exercise of employee stock options, grants of restricted stock, and purchases under the Employee Stock Purchase Plan (ESPP). At September 30, 2013, 2,762,440 Common Shares remain in treasury after net shares redeemed under employee share-based compensation plans.

ACE Limited securities repurchase authorization
In August 2011, the Board of Directors (Board) authorized the repurchase of up to $303 million of ACE’s Common Shares through December 31, 2012. The amount authorized in August 2011 was in addition to the $197 million balance remaining under a $600 million share repurchase program approved in November 2010. In November 2012, the Board authorized an extension of our then-remaining repurchase capacity through December 31, 2013. These authorizations were granted to allow ACE to repurchase Common Shares to partially offset potential dilution from the exercise of stock options and the granting of restricted stock under share-based compensation plans. Such repurchases may be made in the open market, in privately negotiated transactions, block trades, accelerated repurchases and/or through option or other forward transactions. For the three and nine months ended September 30, 2013, ACE repurchased 238,544 Common Shares for a cost of $21 million and 2,701,620 Common Shares for a cost of $233 million, respectively, in a series of open market transactions. At September 30, 2013, $228 million in share repurchase authorization remained through December 31, 2013 pursuant to the November 2010, August 2011, and November 2012 Board authorizations.
Share-based compensation
Share-based compensation
Share-based compensation

The ACE Limited 2004 Long-Term Incentive Plan (the 2004 LTIP) provides for grants of both incentive and non-qualified stock options principally at an option price per share equal to the fair value of ACE’s Common Shares on the date of grant. Stock options are generally granted with a 3-year vesting period and a 10-year term. The stock options vest in equal annual installments over the respective vesting period, which is also the requisite service period. On February 28, 2013, ACE granted 1,815,896 stock options with a weighted-average grant date fair value of $17.29 each. The fair value of the options issued is estimated on the date of grant using the Black-Scholes option pricing model.

The 2004 LTIP also provides for grants of restricted stock and restricted stock units. ACE generally grants restricted stock and restricted stock units with a 4-year vesting period, based on a graded vesting schedule. The restricted stock is granted at market close price on the day of grant. On February 28, 2013, ACE granted 1,345,850 restricted stock awards and 266,065 restricted stock units to employees and officers of ACE and its subsidiaries with a grant date fair value of $85.39 each. Each restricted stock unit represents our obligation to deliver to the holder one Common Share upon vesting.

In May 2013, our shareholders approved an increase of 8 million shares authorized to be issued under the 2004 LTIP, bringing the total shares authorized to 38,600,000 common shares. At September 30, 2013, a total of 11,165,235 shares remain available for future issuance under the 2004 LTIP.
Segment information
Segment information
Segment information

ACE operates through the following business segments: Insurance – North American P&C, Insurance – North American Agriculture, Insurance – Overseas General, Global Reinsurance, and Life. These segments distribute their products through various forms of brokers, agencies, and direct marketing programs. All business segments have established relationships with reinsurance intermediaries.

Effective first quarter 2013, the Insurance – North American segment is presented in two distinct reportable segments: Insurance – North American P&C and Insurance – North American Agriculture. Prior year amounts contained in this report have been adjusted to conform to the new segment presentation.

For segment reporting purposes, certain items have been presented in a different manner than in the consolidated financial statements below. Management uses underwriting income as the main measure of segment performance. ACE calculates underwriting income by subtracting Losses and loss expenses, Policy benefits, Policy acquisition costs, and Administrative expenses from Net premiums earned. For the Insurance – North American Agriculture segment, management includes gains and losses from fair value changes on crop derivatives as a component of underwriting income. For the three and nine months ended September 30, 2013, underwriting income in our Insurance - North American Agriculture segment was $65 million and $111 million, respectively. These amounts include $1 million of realized losses related to crop derivatives which are included in Net realized gains (losses) below. For the Life segment, management includes Net investment income and (Gains) losses from fair value changes in separate account assets that do not qualify for separate account reporting under GAAP as components of underwriting income. For example, for the three months ended September 30, 2013, Life underwriting income of $92 million includes Net investment income of $61 million and gains from fair value changes in separate account assets of $14 million.

The following tables present the operations by segment:

Statement of Operations by Segment
For the Three Months Ended September 30, 2013
Insurance – North American P&C

 
Insurance – North American Agriculture

 
Insurance –
Overseas
General

 
Global
Reinsurance

 
Life

 
Corporate
and Other

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
 
 
Net premiums written
$
1,500

 
$
805

 
$
1,571

 
$
265

 
$
479

 
$
—

 
$
4,620

Net premiums earned
1,444

 
849

 
1,611

 
239

 
467

 
—

 
4,610

Losses and loss expenses
963

 
746

 
712

 
93

 
141

 
—

 
2,655

Policy benefits
—

 
—

 
—

 
—

 
138

 
—

 
138

Policy acquisition costs
159

 
32

 
349

 
52

 
86

 
—

 
678

Administrative expenses
153

 
5

 
263

 
12

 
85

 
45

 
563

Underwriting income (loss)
169

 
66

 
287

 
82

 
17

 
(45
)
 
576

Net investment income
254

 
6

 
128

 
66

 
61

 
7

 
522

Net realized gains (losses) including OTTI
9

 
—

 
(8
)
 
(5
)
 
43

 
1

 
40

Interest expense
3

 
—

 
1

 
2

 
4

 
62

 
72

Other (income) expense:
 
 
 
 
 
 
 
 
 
 
 
 
 
(Gains) losses from fair value changes in separate account assets
—

 
—

 
—

 
—

 
(14
)
 
—

 
(14
)
Other
(13
)
 
8

 
14

 
(7
)
 
4

 
3

 
9

Income tax expense (benefit)
79

 
14

 
78

 
16

 
10

 
(42
)
 
155

Net income (loss)
$
363

 
$
50

 
$
314

 
$
132

 
$
117

 
$
(60
)
 
$
916


Statement of Operations by Segment
For the Three Months Ended September 30, 2012
Insurance – North American P&C

 
Insurance – North American Agriculture

 
Insurance –
Overseas
General

 
Global
Reinsurance

 
Life

 
Corporate
and Other

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
 
 
 
Net premiums written
$
1,373

 
$
1,164

 
$
1,384

 
$
307

 
$
488

 
$
—

 
$
4,716

Net premiums earned
1,306

 
1,166

 
1,432

 
281

 
480

 
—

 
4,665

Losses and loss expenses
819

 
1,291

 
622

 
151

 
164

 
—

 
3,047

Policy benefits
—

 
—

 
—

 
—

 
130

 
—

 
130

Policy acquisition costs
147

 
13

 
329

 
40

 
80

 
—

 
609

Administrative expenses
148

 
—

 
234

 
13

 
81

 
43

 
519

Underwriting income (loss)
192

 
(138
)
 
247

 
77

 
25

 
(43
)
 
360

Net investment income
257

 
6

 
127

 
72

 
63

 
8

 
533

Net realized gains (losses) including OTTI
(2
)
 
1

 
13

 
(2
)
 
(71
)
 
1

 
(60
)
Interest expense
3

 
—

 
2

 
1

 
3

 
54

 
63

Other (income) expense:
 
 
 
 
 
 
 
 
 
 
 
 
 
(Gains) losses from fair value changes in separate account assets
—

 
—

 
—

 
—

 
(14
)
 
—

 
(14
)
Other
(13
)
 
8

 
(3
)
 
(5
)
 
—

 
10

 
(3
)
Income tax expense (benefit)
129

 
(48
)
 
77

 
11

 
14

 
(36
)
 
147

Net income (loss)
$
328

 
$
(91
)
 
$
311

 
$
140

 
$
14

 
$
(62
)
 
$
640


Statement of Operations by Segment
For the Nine Months Ended September 30, 2013
Insurance – North American P&C

 
Insurance – North American Agriculture

 
Insurance –
Overseas
General

 
Global
Reinsurance

 
Life

 
Corporate
and Other

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
 
 
 
Net premiums written
$
4,313

 
$
1,371

 
$
4,821

 
$
836

 
$
1,468

 
$
—

 
$
12,809

Net premiums earned
4,210

 
1,252

 
4,633

 
731

 
1,424

 
—

 
12,250

Losses and loss expenses
2,791

 
1,071

 
2,227

 
292

 
443

 
7

 
6,831

Policy benefits
—

 
—

 
—

 
—

 
379

 
—

 
379

Policy acquisition costs
444

 
56

 
1,048

 
148

 
261

 
—

 
1,957

Administrative expenses
437

 
13

 
750

 
36

 
256

 
149

 
1,641

Underwriting income (loss)
538

 
112

 
608

 
255

 
85

 
(156
)
 
1,442

Net investment income
755

 
19

 
396

 
209

 
187

 
21

 
1,587

Net realized gains (losses) including OTTI
63

 
1

 
34

 
46

 
206

 
—

 
350

Interest expense
4

 
—

 
4

 
4

 
12

 
181

 
205

Other (income) expense:


 


 


 


 


 


 
 
(Gains) losses from fair value changes in separate account assets
—

 
—

 
—

 
—

 
(7
)
 
—

 
(7
)
Other
(38
)
 
24

 
30

 
(13
)
 
7

 
19

 
29

Income tax expense (benefit)
264

 
24

 
174

 
31

 
33

 
(134
)
 
392

Net income (loss)
$
1,126

 
$
84

 
$
830

 
$
488

 
$
433

 
$
(201
)
 
$
2,760


Statement of Operations by Segment
For the Nine Months Ended September 30, 2012
Insurance – North American P&C

 
Insurance – North American Agriculture

 
Insurance –
Overseas
General

 
Global
Reinsurance

 
Life

 
Corporate
and Other

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
 
 
 
Net premiums written
$
3,915

 
$
1,775

 
$
4,387

 
$
879

 
$
1,462

 
$
—

 
$
12,418

Net premiums earned
3,802

 
1,609

 
4,243

 
748

 
1,427

 
—

 
11,829

Losses and loss expenses
2,474

 
1,648

 
2,030

 
355

 
463

 
—

 
6,970

Policy benefits
—

 
—

 
—

 
—

 
379

 
—

 
379

Policy acquisition costs
419

 
25

 
996

 
125

 
244

 
1

 
1,810

Administrative expenses
451

 
(3
)
 
696

 
38

 
237

 
124

 
1,543

Underwriting income (loss)
458

 
(61
)
 
521

 
230

 
104

 
(125
)
 
1,127

Net investment income
789

 
19

 
386

 
213

 
186

 
21

 
1,614

Net realized gains (losses) including OTTI
15

 
1

 
59

 
(6
)
 
(261
)
 
(2
)
 
(194
)
Interest expense
9

 
—

 
4

 
3

 
9

 
162

 
187

Other (income) expense:
 
 
 
 
 
 
 
 
 
 
 
 
 
(Gains) losses from fair value changes in separate account assets
—

 
—

 
—

 
—

 
(18
)
 
—

 
(18
)
Other
(20
)
 
24

 
3

 
(7
)
 
14

 
18

 
32

Income tax expense (benefit)
308

 
(29
)
 
166

 
17

 
44

 
(101
)
 
405

Net income (loss)
$
965

 
$
(36
)
 
$
793

 
$
424

 
$
(20
)
 
$
(185
)
 
$
1,941



Underwriting assets are reviewed in total by management for purposes of decision-making. Other than goodwill and other intangible assets, ACE does not allocate assets to its segments.

The following table presents net premiums earned for each segment by product:
For the Three Months Ended September 30, 2013
Property &
All Other

 
Casualty

 
Life,
Accident &
Health

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
Insurance – North American P&C
$
388

 
$
957

 
$
99

 
$
1,444

Insurance – North American Agriculture
849

 
—

 
—

 
849

Insurance – Overseas General
689

 
375

 
547

 
1,611

Global Reinsurance
141

 
98

 
—

 
239

Life
—

 
—

 
467

 
467

 
$
2,067

 
$
1,430

 
$
1,113

 
$
4,610


For the Three Months Ended September 30, 2012
Property &
All Other

 
Casualty

 
Life,
Accident &
Health

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
Insurance – North American P&C
$
353

 
$
860

 
$
93

 
$
1,306

Insurance – North American Agriculture
1,166

 
—

 
—

 
1,166

Insurance – Overseas General
547

 
356

 
529

 
1,432

Global Reinsurance
131

 
150

 
—

 
281

Life
—

 
—

 
480

 
480

 
$
2,197

 
$
1,366

 
$
1,102

 
$
4,665


For the Nine Months Ended September 30, 2013
Property &
All Other

 
Casualty

 
Life,
Accident &
Health

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
Insurance – North American P&C
$
1,103

 
$
2,826

 
$
281

 
$
4,210

Insurance – North American Agriculture
1,252

 
—

 
—

 
1,252

Insurance – Overseas General
1,932

 
1,088

 
1,613

 
4,633

Global Reinsurance
408

 
323

 
—

 
731

Life
—

 
—

 
1,424

 
1,424

 
$
4,695

 
$
4,237

 
$
3,318

 
$
12,250



For the Nine Months Ended September 30, 2012
Property &
All Other

 
Casualty

 
Life,
Accident &
Health

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
Insurance – North American P&C
$
1,022

 
$
2,505

 
$
275

 
$
3,802

Insurance – North American Agriculture
1,609

 
—

 
—

 
1,609

Insurance – Overseas General
1,637

 
1,027

 
1,579

 
4,243

Global Reinsurance
355

 
393

 
—

 
748

Life
—

 
—

 
1,427

 
1,427

 
$
4,623

 
$
3,925

 
$
3,281

 
$
11,829

Earnings per share
Earnings per share
Earnings per share

The following table presents the computation of basic and diluted earnings per share: 
 
Three Months Ended
 
 
Nine Months Ended
 
 
September 30
 
 
September 30
 
(in millions of U.S. dollars, except share and per share data)
2013

 
2012

 
2013

 
2012

Numerator:
 
 
 
 
 
 
 
Net income
$
916

 
$
640

 
$
2,760

 
$
1,941

Denominator:
 
 
 
 
 
 
 
Denominator for basic earnings per share:
 
 
 
 
 
 
 
Weighted-average shares outstanding
340,888,648

 
340,207,037

 
340,905,322

 
339,523,388

Denominator for diluted earnings per share:
 
 
 
 

 

Share-based compensation plans
2,929,089

 
2,665,676

 
3,146,728

 
2,831,798

Weighted-average shares outstanding and assumed conversions
343,817,737

 
342,872,713

 
344,052,050

 
342,355,186

Basic earnings per share
$
2.68

 
$
1.88

 
$
8.09

 
$
5.71

Diluted earnings per share
$
2.66

 
$
1.86

 
$
8.02

 
$
5.67

 
 
 
 
 
 
 
 
Potential anti-dilutive share conversions
1,215,884

 
1,449,610

 
1,429,514

 
1,193,839



Excluded from weighted-average shares outstanding and assumed conversions is the impact of securities that would have been anti-dilutive during the respective periods.
Information provided in connection with outstanding debt of subsidiaries
Information provided in connection with outstanding debt of subsidiaries
Information provided in connection with outstanding debt of subsidiaries

The following tables present condensed consolidating financial information at September 30, 2013 and December 31, 2012, and for the three and nine months ended September 30, 2013 and 2012, for ACE Limited (Parent Guarantor) and ACE INA Holdings Inc. (Subsidiary Issuer). The Subsidiary Issuer is an indirect 100 percent-owned subsidiary of the Parent Guarantor. The Parent Guarantor fully and unconditionally guarantees certain of the debt of the Subsidiary Issuer.
 
During the third quarter of 2013, we determined that the Subsidiary Issuer columns presented in the previously issued condensed consolidating financial information should be presented on the equity method of accounting rather than on a consolidated basis. Accordingly, we have revised the disclosure to correct the Condensed Consolidating Balance Sheet as of December 31, 2012, the Condensed Consolidating Statements of Operations and Comprehensive Income (Loss) for the three and nine months ended September 30, 2012, and the Condensed Consolidating Statement of Cash Flows for the nine months ended September 30, 2012. As a result of this revision to the Subsidiary Issuer condensed consolidating financial information, the assets and liabilities, revenues and expenses, and cash flows of the subsidiaries of ACE INA Holdings, Inc. (Subsidiary Issuer) are now presented in the Other ACE Limited Subsidiaries column on a combined basis. In addition, we revised the Consolidating Adjustments and Eliminations column to correctly include all intercompany eliminations. Previously, this column reflected only ACE Limited parent company intercompany eliminations. We also revised the Condensed Consolidating Balance Sheet as of December 31, 2012 and Condensed Consolidating Statement of Cash Flows for the nine months ended September 30, 2012 to correct the presentation of negative cash associated with our affiliated notional cash pooling programs (Pools). In addition, certain items in the Condensed Consolidating Statement of Cash Flows for the nine months ended September 30, 2012 have been reclassified to conform to current period presentation. Also, the operating cash flows have been corrected to properly reflect certain intercompany transactions previously recorded in financing cash flows for the nine months ended September 30, 2012.

Total shareholders' equity and net income of the Subsidiary Issuer and Parent Guarantor were not impacted as a result of these revisions. The impact of the revisions was not material to the prior period consolidated financial statements taken as a whole. There was no impact on the consolidated amounts previously reported. The prior period condensed consolidating financial statements will be similarly revised as the information is presented in the 2013 Form 10-K and the first and second quarter Form 10-Q filings for 2014.

For reference only, included in the following pages are the previously reported condensed consolidating information at December 31, 2012 and for the three and nine months ended September 30, 2012.

Condensed Consolidating Balance Sheet at September 30, 2013
(in millions of U.S. dollars)
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE Limited
Consolidated

Assets
 
 
 
 
 
 
 
 
 
Investments
$
29

 
$
10

 
$
60,303

 
$
—

 
$
60,342

Cash(1)
11

 
165

 
1,464

 
(872
)
 
768

Insurance and reinsurance balances receivable
—

 
—

 
6,225

 
(1,136
)
 
5,089

Reinsurance recoverable on losses and loss expenses
—

 
—

 
20,279

 
(8,802
)
 
11,477

Reinsurance recoverable on policy benefits
—

 
—

 
1,246

 
(1,009
)
 
237

Value of business acquired
—

 
—

 
554

 
—

 
554

Goodwill and other intangible assets
—

 
—

 
5,465

 
—

 
5,465

Investments in subsidiaries
28,457

 
17,979

 
—

 
(46,436
)
 
—

Due from subsidiaries and affiliates, net
813

 
—

 
—

 
(813
)
 
—

Other assets
5

 
219

 
12,679

 
(2,251
)
 
10,652

Total assets
$
29,315

 
$
18,373

 
$
108,215

 
$
(61,319
)
 
$
94,584

Liabilities
 
 
 
 
 
 
 
 
 
Unpaid losses and loss expenses
$
—

 
$
—

 
$
46,215

 
$
(8,333
)
 
$
37,882

Unearned premiums
—

 
—

 
9,523

 
(1,729
)
 
7,794

Future policy benefits
—

 
—

 
5,605

 
(1,009
)
 
4,596

Due to (from) subsidiaries and affiliates, net
—

 
661

 
152

 
(813
)
 
—

Affiliated notional cash pooling programs(1)
872

 
—

 
—

 
(872
)
 
—

Short-term debt
—

 
500

 
1,402

 
—

 
1,902

Long-term debt
—

 
3,795

 
12

 
—

 
3,807

Trust preferred securities
—

 
309

 
—

 
—

 
309

Other liabilities
225

 
1,342

 
10,636

 
(2,127
)
 
10,076

Total liabilities
1,097

 
6,607

 
73,545

 
(14,883
)
 
66,366

Total shareholders’ equity
28,218

 
11,766

 
34,670

 
(46,436
)
 
28,218

Total liabilities and shareholders’ equity
$
29,315

 
$
18,373

 
$
108,215

 
$
(61,319
)
 
$
94,584


(1) 
ACE maintains two notional multicurrency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At September 30, 2013, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.
 




Condensed Consolidating Balance Sheet at December 31, 2012 (Revised)

(in millions of U.S. dollars)
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE Limited
Consolidated

Assets
 
 
 
 
 
 
 
 
 
Investments
$
31

 
$
14

 
$
60,219

 
$
—

 
$
60,264

Cash(1)
103

 
2

 
859

 
(349
)
 
615

Insurance and reinsurance balances receivable
—

 
—

 
4,742

 
(595
)
 
4,147

Reinsurance recoverable on losses and loss expenses
—

 
—

 
20,935

 
(8,857
)
 
12,078

Reinsurance recoverable on policy benefits
—

 
—

 
1,229

 
(988
)
 
241

Value of business acquired
—

 
—

 
614

 
—

 
614

Goodwill and other intangible assets
—

 
—

 
4,975

 
—

 
4,975

Investments in subsidiaries
27,251

 
17,016

 
—

 
(44,267
)
 
—

Due from subsidiaries and affiliates, net
204

 
—

 
—

 
(204
)
 
—

Other assets
13

 
210

 
11,304

 
(1,916
)
 
9,611

Total assets
$
27,602

 
$
17,242

 
$
104,877

 
$
(57,176
)
 
$
92,545

Liabilities
 
 
 
 
 
 
 
 
 
Unpaid losses and loss expenses
$
—

 
$
—

 
$
46,109

 
$
(8,163
)
 
$
37,946

Unearned premiums
—

 
—

 
8,248

 
(1,384
)
 
6,864

Future policy benefits
—

 
—

 
5,458

 
(988
)
 
4,470

Due to (from) subsidiaries and affiliates, net
—

 
68

 
136

 
(204
)
 
—

Affiliated notional cash pooling programs(1)
—

 
349

 
—

 
(349
)
 
—

Short-term debt
—

 
—

 
1,401

 
—

 
1,401

Long-term debt
—

 
3,347

 
13

 
—

 
3,360

Trust preferred securities
—

 
309

 
—

 
—

 
309

Other liabilities
71

 
1,195

 
11,219

 
(1,821
)
 
10,664

Total liabilities
71

 
5,268

 
72,584

 
(12,909
)
 
65,014

Total shareholders’ equity
27,531

 
11,974

 
32,293

 
(44,267
)
 
27,531

Total liabilities and shareholders’ equity
$
27,602

 
$
17,242

 
$
104,877

 
$
(57,176
)
 
$
92,545

(1) 
ACE maintains two notional multicurrency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At December 31, 2012, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.
Condensed Consolidating Balance Sheet at December 31, 2012 (As previously reported)

(in millions of U.S. dollars)
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries and
Eliminations(1)

 
Consolidating
Adjustments(2)

 
ACE Limited
Consolidated

Assets
 
 
 
 
 
 
 
 
 
Investments
$
31

 
$
31,074

 
$
29,159

 
$
—

 
$
60,264

Cash(3)
103

 
515

 
(3
)
 
—

 
615

Insurance and reinsurance balances receivable
—

 
3,654

 
493

 
—

 
4,147

Reinsurance recoverable on losses and loss expenses
—

 
17,232

 
(5,154
)
 
—

 
12,078

Reinsurance recoverable on policy benefits
—

 
1,187

 
(946
)
 
—

 
241

Value of business acquired
—

 
610

 
4

 
—

 
614

Goodwill and other intangible assets
—

 
4,419

 
556

 
—

 
4,975

Investments in subsidiaries
27,251

 
—

 
—

 
(27,251
)
 
—

Due from subsidiaries and affiliates, net
204

 
—

 
—

 
(204
)
 
—

Other assets
13

 
7,563

 
2,035

 
—

 
9,611

Total assets
$
27,602

 
$
66,254

 
$
26,144

 
$
(27,455
)
 
$
92,545

Liabilities
 
 
 
 
 
 
 
 
 
Unpaid losses and loss expenses
$
—

 
$
31,356

 
$
6,590

 
$
—

 
$
37,946

Unearned premiums
—

 
5,872

 
992

 
—

 
6,864

Future policy benefits
—

 
3,876

 
594

 
—

 
4,470

Due to (from) subsidiaries and affiliates, net
—

 
384

 
(180
)
 
(204
)
 
—

Short-term debt
—

 
851

 
550

 
—

 
1,401

Long-term debt
—

 
3,360

 
—

 
—

 
3,360

Trust preferred securities
—

 
309

 
—

 
—

 
309

Other liabilities
71

 
8,272

 
2,321

 
—

 
10,664

Total liabilities
71

 
54,280

 
10,867

 
(204
)
 
65,014

Total shareholders’ equity
27,531

 
11,974

 
15,277

 
(27,251
)
 
27,531

Total liabilities and shareholders’ equity
$
27,602

 
$
66,254

 
$
26,144

 
$
(27,455
)
 
$
92,545

(1)
Includes all other subsidiaries of ACE Limited and intercompany eliminations, primarily intercompany reinsurance transactions.
(2)
Includes ACE Limited parent company eliminations.
(3)
ACE maintains two notional multicurrency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At December 31, 2012, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.


Condensed Consolidating Statements of Operations and Comprehensive Income
For the Three Months Ended September 30, 2013
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net premiums written
$
—

 
$
—

 
$
4,620

 
$
—

 
$
4,620

Net premiums earned
—

 
—

 
4,610

 
—

 
4,610

Net investment income
1

 
—

 
521

 
—

 
522

Equity in earnings of subsidiaries
863

 
322

 
—

 
(1,185
)
 
—

Net realized gains (losses) including OTTI
—

 
(2
)
 
42

 
—

 
40

Losses and loss expenses
—

 
—

 
2,655

 
—

 
2,655

Policy benefits
—

 
—

 
138

 
—

 
138

Policy acquisition costs and administrative expenses
13

 
4

 
1,224

 
—

 
1,241

Interest (income) expense
(8
)
 
69

 
11

 
—

 
72

Other (income) expense
(62
)
 
6

 
51

 
—

 
(5
)
Income tax expense (benefit)
5

 
(14
)
 
164

 
—

 
155

Net income
$
916

 
$
255

 
$
930

 
$
(1,185
)
 
$
916

Comprehensive income
$
1,030

 
$
339

 
$
1,043

 
$
(1,382
)
 
$
1,030



Condensed Consolidating Statements of Operations and Comprehensive Income (Revised)
For the Three Months Ended September 30, 2012
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net premiums written
$
—

 
$
—

 
$
4,716

 
$
—

 
$
4,716

Net premiums earned
—

 
—

 
4,665

 
—

 
4,665

Net investment income
—

 
1

 
532

 
—

 
533

Equity in earnings of subsidiaries
616

 
285

 
—

 
(901
)
 
—

Net realized gains (losses) including OTTI
(4
)
 
—

 
(56
)
 
—

 
(60
)
Losses and loss expenses
—

 
—

 
3,047

 
—

 
3,047

Policy benefits
—

 
—

 
130

 
—

 
130

Policy acquisition costs and administrative expenses
16

 
6

 
1,106

 
—

 
1,128

Interest (income) expense
(8
)
 
60

 
11

 
—

 
63

Other (income) expense
(39
)
 
7

 
15

 
—

 
(17
)
Income tax expense (benefit)
3

 
(24
)
 
168

 
—

 
147

Net income
$
640

 
$
237

 
$
664

 
$
(901
)
 
$
640

Comprehensive income
$
1,316

 
$
593

 
$
1,339

 
$
(1,932
)
 
$
1,316



Condensed Consolidating Statements of Operations and Comprehensive Income (As previously reported)
For the Three Months Ended September 30, 2012
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries and
Eliminations(1)

 
Consolidating
Adjustments (2)

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net premiums written
$
—

 
$
2,868

 
$
1,848

 
$
—

 
$
4,716

Net premiums earned
—

 
2,819

 
1,846

 
—

 
4,665

Net investment income
—

 
255

 
278

 
—

 
533

Equity in earnings of subsidiaries
616

 
—

 
—

 
(616
)
 
—

Net realized gains (losses) including OTTI
(4
)
 
11

 
(67
)
 
—

 
(60
)
Losses and loss expenses
—

 
1,977

 
1,070

 
—

 
3,047

Policy benefits
—

 
77

 
53

 
—

 
130

Policy acquisition costs and administrative expenses
16

 
587

 
525

 
—

 
1,128

Interest (income) expense
(8
)
 
67

 
4

 
—

 
63

Other (income) expense
(39
)
 
17

 
5

 
—

 
(17
)
Income tax expense
3

 
123

 
21

 
—

 
147

Net income
$
640

 
$
237

 
$
379

 
$
(616
)
 
$
640

Comprehensive income
$
1,316

 
$
593

 
$
23

 
$
(616
)
 
$
1,316

(1)
Includes all other subsidiaries of ACE Limited and intercompany eliminations.
(2)
Includes ACE Limited parent company eliminations.


Condensed Consolidating Statements of Operations and Comprehensive Income (Loss)
For the Nine Months Ended September 30, 2013
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net premiums written
$
—

 
$
—

 
$
12,809

 
$
—

 
$
12,809

Net premiums earned
—

 
—

 
12,250

 
—

 
12,250

Net investment income
2

 
2

 
1,583

 
—

 
1,587

Equity in earnings of subsidiaries
2,619

 
767

 
—

 
(3,386
)
 
—

Net realized gains (losses) including OTTI
12

 
(2
)
 
340

 
—

 
350

Losses and loss expenses
—

 
—

 
6,831

 
—

 
6,831

Policy benefits
—

 
—

 
379

 
—

 
379

Policy acquisition costs and administrative expenses
40

 
13

 
3,545

 
—

 
3,598

Interest (income) expense
(23
)
 
200

 
28

 
—

 
205

Other (income) expense
(157
)
 
21

 
158

 
—

 
22

Income tax expense (benefit)
13

 
(80
)
 
459

 
—

 
392

Net income
$
2,760

 
$
613

 
$
2,773

 
$
(3,386
)
 
$
2,760

Comprehensive income (loss)
$
1,247

 
$
(195
)
 
$
1,259

 
$
(1,064
)
 
$
1,247



Condensed Consolidating Statements of Operations and Comprehensive Income (Revised)
For the Nine Months Ended September 30, 2012
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net premiums written
$
—

 
$
—

 
$
12,418

 
$
—

 
$
12,418

Net premiums earned
—

 
—

 
11,829

 
—

 
11,829

Net investment income
1

 
2

 
1,611

 
—

 
1,614

Equity in earnings of subsidiaries
1,845

 
775

 
—

 
(2,620
)
 
—

Net realized gains (losses) including OTTI
18

 
—

 
(212
)
 
—

 
(194
)
Losses and loss expenses
—

 
—

 
6,970

 
—

 
6,970

Policy benefits
—

 
—

 
379

 
—

 
379

Policy acquisition costs and administrative expenses
42

 
20

 
3,291

 
—

 
3,353

Interest (income) expense
(25
)
 
175

 
37

 
—

 
187

Other (income) expense
(102
)
 
(8
)
 
124

 
—

 
14

Income tax expense (benefit)
8

 
(72
)
 
469

 
—

 
405

Net income
$
1,941

 
$
662

 
$
1,958

 
$
(2,620
)
 
$
1,941

Comprehensive income
$
3,044

 
$
1,203

 
$
3,060

 
$
(4,263
)
 
$
3,044



Condensed Consolidating Statements of Operations and Comprehensive Income (As previously reported)
For the Nine Months Ended September 30, 2012
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries and
Eliminations(1)

 
Consolidating
Adjustments (2)

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net premiums written
$
—

 
$
7,293

 
$
5,125

 
$
—

 
$
12,418

Net premiums earned
—

 
6,967

 
4,862

 
—

 
11,829

Net investment income
1

 
777

 
836

 
—

 
1,614

Equity in earnings of subsidiaries
1,845

 
—

 
—

 
(1,845
)
 
—

Net realized gains (losses) including OTTI
18

 
71

 
(283
)
 
—

 
(194
)
Losses and loss expenses
—

 
4,484

 
2,486

 
—

 
6,970

Policy benefits
—

 
217

 
162

 
—

 
379

Policy acquisition costs and administrative expenses
42

 
1,883

 
1,428

 
—

 
3,353

Interest (income) expense
(25
)
 
191

 
21

 
—

 
187

Other (income) expense
(102
)
 
51

 
65

 
—

 
14

Income tax expense
8

 
327

 
70

 
—

 
405

Net income
$
1,941

 
$
662

 
$
1,183

 
$
(1,845
)
 
$
1,941

Comprehensive income
$
3,044

 
$
1,203

 
$
642

 
$
(1,845
)
 
$
3,044

(1)
Includes all other subsidiaries of ACE Limited and intercompany eliminations.
(2)
Includes ACE Limited parent company eliminations.

Condensed Consolidating Statement of Cash Flows
For the Nine Months Ended September 30, 2013
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net cash flows from (used for) operating activities
$
80

 
$
2

 
$
2,654

 
$
—

 
$
2,736

Cash flows from investing activities
 
 
 
 
 
 
 
 
 
Purchases of fixed maturities available for sale and net change in short-term investments
—

 
4

 
(15,996
)
 
103

 
(15,889
)
Purchases of fixed maturities held to maturity
—

 
—

 
(374
)
 
—

 
(374
)
Purchases of equity securities
—

 
—

 
(217
)
 
—

 
(217
)
Sales of fixed maturities available for
sale
—

 
—

 
8,115

 
(103
)
 
8,012

Sales of equity securities
—

 
—

 
99

 
—

 
99

Maturities and redemptions of fixed maturities available for sale
—

 
—

 
5,538

 
—

 
5,538

Maturities and redemptions of fixed maturities held to maturity
—

 
—

 
1,233

 
—

 
1,233

Net derivative instruments settlements
—

 
(1
)
 
(375
)
 
—

 
(376
)
Acquisition of subsidiaries (net of cash acquired of $38)
—

 
—

 
(977
)
 
—

 
(977
)
Capital contribution
(133
)
 
(1,010
)
 
—

 
1,143

 
—

Other
—

 
(5
)
 
(183
)
 
—

 
(188
)
Net cash flows used for investing activities
(133
)
 
(1,012
)
 
(3,137
)
 
1,143

 
(3,139
)
Cash flows from financing activities
 
 
 
 
 
 
 
 
 
Dividends paid on Common Shares
(343
)
 
—

 
—

 
—

 
(343
)
Common Shares repurchased
—

 
—

 
(233
)
 
—

 
(233
)
Proceeds from issuance of long-term debt
—

 
947

 
—

 
—

 
947

Net proceeds from issuance of short-term debt
—

 
—

 
1

 
—

 
1

Proceeds from share-based compensation plans, including windfall tax benefits
7

 
—

 
105

 
—

 
112

Advances (to) from affiliates
(575
)
 
575

 
—

 
—

 
—

Capital contribution
—

 
—

 
1,143

 
(1,143
)
 
—

Net proceeds from (payments to) affiliated notional cash pooling programs(1)
872

 
(349
)
 
—

 
(523
)
 
—

Other
—

 
—

 
68

 
—

 
68

Net cash flows from (used for) financing activities
(39
)
 
1,173

 
1,084

 
(1,666
)
 
552

Effect of foreign currency rate changes on cash and cash equivalents
—

 
—

 
4

 
—

 
4

Net (decrease) increase in cash
(92
)
 
163

 
605

 
(523
)
 
153

Cash – beginning of period(1)
103

 
2

 
859

 
(349
)
 
615

Cash – end of period(1)
$
11

 
$
165

 
$
1,464

 
$
(872
)
 
$
768

(1) 
ACE maintains two notional multicurrency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At September 30, 2013 and December 31, 2012, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.

Condensed Consolidating Statement of Cash Flows (Revised)
For the Nine Months Ended September 30, 2012
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net cash flows from operating activities
$
136

 
$
127

 
$
2,882

 
$
(120
)
 
$
3,025

Cash flows from investing activities
 
 
 
 
 
 
 
 
 
Purchases of fixed maturities available for sale and net change in short-term investments
—

 
—

 
(17,803
)
 
147

 
(17,656
)
Purchases of fixed maturities held to maturity
—

 
—

 
(217
)
 
—

 
(217
)
Purchases of equity securities
—

 
—

 
(114
)
 
—

 
(114
)
Sales of fixed maturities available for sale
—

 
—

 
11,502

 
(147
)
 
11,355

Sales of equity securities
—

 
—

 
57

 
—

 
57

Maturities and redemptions of fixed maturities available for sale
—

 
—

 
3,596

 
—

 
3,596

Maturities and redemptions of fixed maturities held to maturity
—

 
—

 
1,092

 
—

 
1,092

Net derivative instruments settlements
(1
)
 
—

 
(357
)
 
—

 
(358
)
Acquisition of subsidiaries (net of cash acquired of $8)
—

 
—

 
(98
)
 
—

 
(98
)
Capital contribution
—

 
(89
)
 
(90
)
 
179

 
—

Other
—

 
(2
)
 
(337
)
 
—

 
(339
)
Net cash flows used for investing activities
(1
)
 
(91
)
 
(2,769
)
 
179

 
(2,682
)
Cash flows from financing activities
 
 
 
 
 
 
 
 
 
Dividends paid on Common Shares
(484
)
 
—

 
—

 
—

 
(484
)
Common Shares repurchased
—

 
—

 
(11
)
 
—

 
(11
)
Net proceeds from issuance of short-term debt
—

 
—

 
151

 
—

 
151

Proceeds from share-based compensation plans
17

 
—

 
56

 
—

 
73

Advances (to) from affiliates
110

 
(106
)
 
(4
)
 
—

 
—

Dividends to parent company
—

 
—

 
(120
)
 
120

 
—

Capital contribution
—

 
90

 
89

 
(179
)
 
—

Net proceeds from (payments to) affiliated notional cash pooling programs(1)
116

 
7

 
—

 
(123
)
 
—

Net cash flows from (used for) financing activities
(241
)
 
(9
)
 
161

 
(182
)
 
(271
)
Effect of foreign currency rate changes on cash and cash equivalents
—

 
—

 
4

 
—

 
4

Net increase (decrease) in cash
(106
)
 
27

 
278

 
(123
)
 
76

Cash – beginning of period(1)
106

 
5

 
651

 
(148
)
 
614

Cash – end of period(1)
$
—

 
$
32

 
$
929

 
$
(271
)
 
$
690


(1) 
ACE maintains two notional multicurrency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At September 30, 2012 and December 31, 2011, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.
Condensed Consolidating Statement of Cash Flows (As previously reported)
For the Nine Months Ended September 30, 2012
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries and
Eliminations(1)

 
Consolidating
Adjustments(2)

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net cash flows from operating activities
$
210

 
$
1,553

 
$
1,262

 
$
—

 
$
3,025

Cash flows from investing activities
 
 
 
 
 
 
 
 
 
Purchases of fixed maturities available for sale
—

 
(8,553
)
 
(9,103
)
 
—

 
(17,656
)
Purchases of fixed maturities held to maturity
—

 
(215
)
 
(2
)
 
—

 
(217
)
Purchases of equity securities
—

 
(65
)
 
(49
)
 
—

 
(114
)
Sales of fixed maturities available for sale
—

 
5,154

 
6,201

 
—

 
11,355

Sales of equity securities
—

 
48

 
9

 
—

 
57

Maturities and redemptions of fixed maturities available for sale
—

 
1,757

 
1,839

 
—

 
3,596

Maturities and redemptions of fixed maturities held to maturity
—

 
798

 
294

 
—

 
1,092

Net derivative instruments settlements
(1
)
 
(10
)
 
(347
)
 
—

 
(358
)
Advances from affiliates
36

 
—

 
—

 
(36
)
 
—

Acquisition of subsidiaries (net of cash acquired of $8)
—

 
(98
)
 
—

 
—

 
(98
)
Capital contribution
—

 
—

 
(90
)
 
90

 
—

Other
—

 
(279
)
 
(60
)
 
—

 
(339
)
Net cash flows from (used for) investing activities
35

 
(1,463
)
 
(1,308
)
 
54

 
(2,682
)
Cash flows from financing activities
 
 
 
 
 
 
 
 
 
Dividends paid on Common Shares
(484
)
 
—

 
—

 
—

 
(484
)
Common Shares repurchased
—

 
—

 
(11
)
 
—

 
(11
)
Net proceeds from issuance of short-term debt
—

 
1

 
150

 
—

 
151

Proceeds from share-based compensation plans
17

 
—

 
56

 
—

 
73

Advances to affiliates
—

 
(10
)
 
(26
)
 
36

 
—

Capital contribution
—

 
90

 
—

 
(90
)
 
—

Net cash flows from (used for) financing activities
(467
)
 
81

 
169

 
(54
)
 
(271
)
Effect of foreign currency rate changes on cash and cash equivalents
—

 
(3
)
 
7

 
—

 
4

Net increase (decrease) in cash
(222
)
 
168

 
130

 
—

 
76

Cash – beginning of period
106

 
382

 
126

 
—

 
614

Cash – end of period(3)
$
(116
)
 
$
550

 
$
256

 
$
—

 
$
690

(1)
Includes all other subsidiaries of ACE Limited and intercompany eliminations.
(2)
Includes ACE Limited parent company eliminations and certain consolidating adjustments.
(3)
ACE maintains two notional multicurrency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At September 30, 2012 and December 31, 2011, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.
General (Policies)
Basis of presentation
ACE Limited is a holding company incorporated in Zurich, Switzerland. ACE Limited, through its various subsidiaries, provides a broad range of insurance and reinsurance products to insureds worldwide. ACE operates through the following business segments: Insurance – North American P&C, Insurance – North American Agriculture, Insurance – Overseas General, Global Reinsurance, and Life. Refer to Note 10 for additional information.

The interim unaudited consolidated financial statements, which include the accounts of ACE Limited and its subsidiaries (collectively, ACE, we, us, or our), have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and, in the opinion of management, reflect all adjustments (consisting of normally recurring accruals) necessary for a fair statement of the results and financial position for such periods. All significant intercompany accounts and transactions have been eliminated.

The results of operations and cash flows for any interim period are not necessarily indicative of the results for the full year. These consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in our 2012 Form 10-K.
Investments (Tables)
Schedule Of Amortized Cost And Fair Value Of Fixed Maturities And Related OTTI Recognized In AOCI 
September 30, 2013
Amortized
Cost

 
Gross
Unrealized
Appreciation

 
Gross
Unrealized
Depreciation

 
Fair
Value

 
OTTI Recognized
in AOCI

(in millions of U.S. dollars)
 
 
 
 
Available for sale
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency
$
2,934

 
$
81

 
$
(36
)
 
$
2,979

 
$
—

Foreign
14,294

 
405

 
(98
)
 
14,601

 
—

Corporate securities
16,664

 
753

 
(151
)
 
17,266

 
(6
)
Mortgage-backed securities
10,294

 
234

 
(149
)
 
10,379

 
(36
)
States, municipalities, and political subdivisions
3,295

 
72

 
(63
)
 
3,304

 
—

 
$
47,481

 
$
1,545

 
$
(497
)
 
$
48,529

 
$
(42
)
Held to maturity
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency
$
842

 
$
20

 
$
(3
)
 
$
859

 
$
—

Foreign
876

 
36

 
—

 
912

 
—

Corporate securities
1,960

 
87

 
—

 
2,047

 
—

Mortgage-backed securities
1,440

 
43

 
—

 
1,483

 
—

States, municipalities, and political subdivisions
1,188

 
19

 
(15
)
 
1,192

 
—

 
$
6,306

 
$
205

 
$
(18
)
 
$
6,493

 
$
—


December 31, 2012
Amortized
Cost

 
Gross
Unrealized
Appreciation

 
Gross
Unrealized
Depreciation

 
Fair
Value

 
OTTI Recognized
in AOCI

(in millions of U.S. dollars)
 
 
 
 
Available for sale
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency
$
3,553

 
$
183

 
$
(1
)
 
$
3,735

 
$
—

Foreign
13,016

 
711

 
(14
)
 
13,713

 
—

Corporate securities
15,529

 
1,210

 
(31
)
 
16,708

 
(7
)
Mortgage-backed securities
10,051

 
458

 
(36
)
 
10,473

 
(84
)
States, municipalities, and political subdivisions
2,517

 
163

 
(3
)
 
2,677

 
—

 
$
44,666

 
$
2,725

 
$
(85
)
 
$
47,306

 
$
(91
)
Held to maturity
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency
$
1,044

 
$
39

 
$
—

 
$
1,083

 
$
—

Foreign
910

 
54

 
—

 
964

 
—

Corporate securities
2,133

 
142

 
—

 
2,275

 
—

Mortgage-backed securities
2,028

 
88

 
—

 
2,116

 
—

States, municipalities, and political subdivisions
1,155

 
44

 
(4
)
 
1,195

 
—

 
$
7,270

 
$
367

 
$
(4
)
 
$
7,633

 
$
—


Schedule Of Fixed Maturities By Contractual Maturity 
 
 
 
September 30

 
 
 
December 31

 
 
 
2013

 
 
 
2012

(in millions of U.S. dollars)
Amortized Cost

 
Fair Value

 
Amortized Cost

 
Fair Value

Available for sale
 
 
 
 
 
 
 
Due in 1 year or less
$
2,317

 
$
2,345

 
$
1,887

 
$
1,906

Due after 1 year through 5 years
13,978

 
14,450

 
13,411

 
14,010

Due after 5 years through 10 years
16,291

 
16,650

 
15,032

 
16,153

Due after 10 years
4,601

 
4,705

 
4,285

 
4,764

 
37,187

 
38,150

 
34,615

 
36,833

Mortgage-backed securities
10,294

 
10,379

 
10,051

 
10,473

 
$
47,481

 
$
48,529

 
$
44,666

 
$
47,306

Held to maturity
 
 
 
 
 
 
 
Due in 1 year or less
$
398

 
$
401

 
$
656

 
$
659

Due after 1 year through 5 years
2,335

 
2,417

 
1,870

 
1,950

Due after 5 years through 10 years
1,707

 
1,756

 
2,119

 
2,267

Due after 10 years
426

 
436

 
597

 
641

 
4,866

 
5,010

 
5,242

 
5,517

Mortgage-backed securities
1,440

 
1,483

 
2,028

 
2,116

 
$
6,306

 
$
6,493

 
$
7,270

 
$
7,633

Schedule Of Cost And Fair Value Of Equity Securities 
 
September 30


December 31

(in millions of U.S. dollars)
2013


2012

Cost
$
835

 
$
707

Gross unrealized appreciation
53

 
41

Gross unrealized depreciation
(57
)
 
(4
)
Fair value
$
831

 
$
744

Schedule Of Net Realized Gains (Losses) And The Losses Included In Net Realized Gains (Losses) And OCI 
 
Three Months Ended
 
 
Nine Months Ended
 
 
September 30
 
 
September 30
 
(in millions of U.S. dollars)
2013

 
2012

 
2013

 
2012

Fixed maturities:
 
 
 
 
 
 
 
OTTI on fixed maturities, gross
$
(4
)
 
$
(10
)
 
$
(11
)
 
$
(18
)
OTTI on fixed maturities recognized in OCI (pre-tax)
—

 
—

 
—

 
—

OTTI on fixed maturities, net
(4
)
 
(10
)
 
(11
)
 
(18
)
Gross realized gains excluding OTTI
37

 
71

 
163

 
287

Gross realized losses excluding OTTI
(16
)
 
(14
)
 
(68
)
 
(120
)
Total fixed maturities
17

 
47

 
84

 
149

Equity securities:
 
 
 
 
 
 
 
OTTI on equity securities
—

 
—

 
(1
)
 
(5
)
Gross realized gains excluding OTTI
8

 
3

 
18

 
5

Gross realized losses excluding OTTI
(1
)
 
(1
)
 
(4
)
 
(2
)
Total equity securities
7

 
2

 
13

 
(2
)
OTTI on other investments
—

 
—

 
(2
)
 
(7
)
Foreign exchange gains (losses)
(26
)
 
(50
)
 
45

 
(64
)
Investment and embedded derivative instruments
4

 
4

 
62

 
(3
)
Fair value adjustments on insurance derivative
134

 
83

 
563

 
44

S&P put options and futures
(95
)
 
(147
)
 
(413
)
 
(308
)
Other derivative instruments
(1
)
 
—

 
(2
)
 
(4
)
Other
—

 
1

 
—

 
1

Net realized gains (losses)
$
40

 
$
(60
)
 
$
350

 
$
(194
)
Schedule Of Roll-Forward Of Pre-Tax Credit Losses Related To Fixed Maturities For Which A Portion Of OTTI Was Recognized In OCI 
 
Three Months Ended
 
 
Nine Months Ended
 
 
September 30
 
 
September 30
 
(in millions of U.S. dollars)
2013

 
2012

 
2013

 
2012

Balance of credit losses related to securities still held – beginning of period
$
40

 
$
47

 
$
43

 
$
74

Additions where no OTTI was previously recorded
1

 
1

 
5

 
3

Additions where an OTTI was previously recorded
—

 
6

 
3

 
11

Reductions for securities sold during the period
(3
)
 
(4
)
 
(13
)
 
(38
)
Balance of credit losses related to securities still held – end of period
$
38

 
$
50

 
$
38

 
$
50

Schedule Of Aggregate Fair Value And Gross Unrealized Loss By Length Of Time The Security Has Continuously Been In An Unrealized Loss Position 
 
0 – 12 Months
 
 
Over 12 Months
 
 
Total
 
September 30, 2013
Fair Value

 
Gross
Unrealized
Loss

 
Fair Value

 
Gross
Unrealized
Loss

 
Fair Value

 
Gross
Unrealized
Loss

(in millions of U.S. dollars)
 
 
 
 
 
U.S. Treasury and agency
$
1,436

 
$
(39
)
 
$
—

 
$
—

 
$
1,436

 
$
(39
)
Foreign
4,034

 
(93
)
 
112

 
(5
)
 
4,146

 
(98
)
Corporate securities
4,696

 
(142
)
 
67

 
(9
)
 
4,763

 
(151
)
Mortgage-backed securities
3,751

 
(139
)
 
132

 
(10
)
 
3,883

 
(149
)
States, municipalities, and political subdivisions
2,076

 
(77
)
 
3

 
(1
)
 
2,079

 
(78
)
Total fixed maturities
15,993

 
(490
)
 
314

 
(25
)
 
16,307

 
(515
)
Equity securities
500

 
(57
)
 
—

 
—

 
500

 
(57
)
Other investments
40

 
(9
)
 
—

 
—

 
40

 
(9
)
Total
$
16,533

 
$
(556
)
 
$
314

 
$
(25
)
 
$
16,847

 
$
(581
)
 
 
0 – 12 Months
 
 
Over 12 Months
 
 
Total
 
December 31, 2012
Fair Value

 
Gross
Unrealized
Loss

 
Fair Value

 
Gross
Unrealized
Loss

 
Fair Value

 
Gross
Unrealized
Loss

(in millions of U.S. dollars)
 
 
 
 
 
U.S. Treasury and agency
$
440

 
$
(1
)
 
$
—

 
$
—

 
$
440

 
$
(1
)
Foreign
1,234

 
(8
)
 
88

 
(6
)
 
1,322

 
(14
)
Corporate securities
1,026

 
(23
)
 
85

 
(8
)
 
1,111

 
(31
)
Mortgage-backed securities
855

 
(4
)
 
356

 
(32
)
 
1,211

 
(36
)
States, municipalities, and political subdivisions
316

 
(3
)
 
48

 
(4
)
 
364

 
(7
)
Total fixed maturities
3,871

 
(39
)
 
577

 
(50
)
 
4,448

 
(89
)
Equity securities
29

 
(4
)
 
—

 
—

 
29

 
(4
)
Other investments
68

 
(5
)
 
—

 
—

 
68

 
(5
)
Total
$
3,968

 
$
(48
)
 
$
577

 
$
(50
)
 
$
4,545

 
$
(98
)
Schedule Of Components Of Restricted Assets 
 
September 30

 
December 31

(in millions of U.S. dollars)
2013

 
2012

Trust funds
$
11,269

 
$
11,389

Deposits with non-U.S. regulatory authorities
1,999

 
2,133

Assets pledged under repurchase agreements
1,405

 
1,401

Deposits with U.S. regulatory authorities
1,333

 
1,338

Other pledged assets
394

 
456

 
$
16,400

 
$
16,717

Fair value measurements (Tables)
Financial Instruments Measured At Fair Value On A Recurring Basis 
September 30, 2013
Level 1

 
Level 2

 
Level 3

 
Total

(in millions of U.S. dollars)
 
 
 
Assets:
 
 
 
 
 
 
 
Fixed maturities available for sale
 
 
 
 
 
 
 
U.S. Treasury and agency
$
1,615

 
$
1,364

 
$
—

 
$
2,979

Foreign
235

 
14,324

 
42

 
14,601

Corporate securities
1

 
17,144

 
121

 
17,266

Mortgage-backed securities
—

 
10,370

 
9

 
10,379

States, municipalities, and political subdivisions
—

 
3,304

 
—

 
3,304

 
1,851

 
46,506

 
172

 
48,529

Equity securities
375

 
452

 
4

 
831

Short-term investments
1,061

 
705

 
8

 
1,774

Other investments
292

 
221

 
2,389

 
2,902

Securities lending collateral
—

 
1,517

 
—

 
1,517

Investment derivative instruments
(18
)
 
—

 
—

 
(18
)
Other derivative instruments
7

 
8

 
—

 
15

Separate account assets
1,074

 
78

 
—

 
1,152

Total assets measured at fair value
$
4,642

 
$
49,487

 
$
2,573

 
$
56,702

Liabilities:
 
 
 
 
 
 
 
GLB(1)
$
—

 
$
—

 
$
514

 
$
514

(1) 
Our GLB reinsurance product meets the definition of a derivative instrument for accounting purposes and is accordingly carried at fair value. Excluded from the table above is the portion of the GLB derivative liability classified as Future policy benefits in the consolidated balance sheets. Refer to Note 5 for additional information.
 
December 31, 2012
Level 1

 
Level 2

 
Level 3

 
Total

(in millions of U.S. dollars)
 
 
 
Assets:
 
 
 
 
 
 
 
Fixed maturities available for sale
 
 
 
 
 
 
 
U.S. Treasury and agency
$
2,050

 
$
1,685

 
$
—

 
$
3,735

Foreign
222

 
13,431

 
60

 
13,713

Corporate securities
20

 
16,586

 
102

 
16,708

Mortgage-backed securities
—

 
10,460

 
13

 
10,473

States, municipalities, and political subdivisions
—

 
2,677

 
—

 
2,677

 
2,292

 
44,839

 
175

 
47,306

Equity securities
253

 
488

 
3

 
744

Short-term investments
1,503

 
725

 
—

 
2,228

Other investments
268

 
196

 
2,252

 
2,716

Securities lending collateral
—

 
1,791

 
—

 
1,791

Investment derivative instruments
11

 
—

 
—

 
11

Other derivative instruments
(6
)
 
30

 
—

 
24

Separate account assets
872

 
71

 
—

 
943

Total assets measured at fair value
$
5,193

 
$
48,140

 
$
2,430

 
$
55,763

Liabilities:
 
 
 
 
 
 
 
GLB(1)
$
—

 
$
—

 
$
1,119

 
$
1,119

(1) 
Our GLB reinsurance product meets the definition of a derivative instrument for accounting purposes and is accordingly carried at fair value. Excluded from the table above is the portion of the GLB derivative liability classified as Future policy benefits in the consolidated balance sheets. Refer to Note 5 for additional information.
Fair Value And Maximum Future Funding Commitments Related To Investments 
 
 
 
 
 
September 30

 
 
 
December 31

 
Expected
Liquidation
Period
 
 
 
2013

 
 
 
2012

(in millions of U.S. dollars)
Fair
Value

 
Maximum
Future Funding
Commitments

 
Fair
Value

 
Maximum
Future Funding
Commitments

Financial
5 to 9 Years
 
$
249

 
$
83

 
$
225

 
$
111

Real estate
3 to 9 Years
 
342

 
78

 
292

 
62

Distressed
6 to 9 Years
 
168

 
122

 
192

 
152

Mezzanine
6 to 9 Years
 
243

 
285

 
284

 
279

Traditional
3 to 8 Years
 
811

 
505

 
711

 
587

Vintage
1 to 3 Years
 
12

 
—

 
14

 
—

Investment funds
Not Applicable
 
415

 
—

 
395

 
—

 
 
 
$
2,240

 
$
1,073

 
$
2,113

 
$
1,191

Schedule Of Significant Unobservable Inputs Used In Level 3 Liability Valuations 
(in millions of U.S. dollars, except for percentages)
Fair Value at
September 30, 2013

 
Fair Value at
December 31, 2012

 
Valuation
Technique
 
Significant
Unobservable Inputs
 
Ranges
GLB(1)
$
514

 
$
1,119

 
Actuarial model
 
Lapse rate
 
1% – 30%
 
 
 
 
 
 
 
Annuitization rate
 
0% – 50%
(1) 
Discussion of the most significant inputs used in the fair value measurement of GLB and the sensitivity of those assumptions is included within Note 4 a) Guaranteed living benefits.
Financial Instruments Measured At Fair Value Using Significant Unobservable Inputs 
 
Assets
 
 
Liabilities

Three Months Ended
Available-for-Sale Debt Securities
Equity
securities

 
Short-term investments

 
Other
investments

 
GLB(1)

September 30, 2013
Foreign

 
Corporate
securities

 
MBS

 
 
(in millions of U.S. dollars)
 
 
 
 
Balance–Beginning of Period
$
48

 
$
114

 
$
9

 
$
4

 
$
9

 
$
2,349

 
$
652

Transfers into Level 3
1

 
12

 
—

 
—

 
1

 
—

 
—

Transfers out of Level 3
(8
)
 
(1
)
 
—

 
—

 
(2
)
 
—

 
—

Change in Net Unrealized Gains (Losses) included in OCI
2

 
(1
)
 
—

 
—

 
—

 
(1
)
 
—

Net Realized Gains/Losses
—

 
(1
)
 
—

 
—

 
—

 
—

 
(138
)
Purchases
12

 
6

 
—

 
—

 
—

 
138

 
—

Sales
(13
)
 
(4
)
 
—

 
—

 
—

 
(1
)
 
—

Settlements
—

 
(4
)
 
—

 
—

 
—

 
(96
)
 
—

Balance–End of Period
$
42

 
$
121

 
$
9

 
$
4

 
$
8

 
$
2,389

 
$
514

Net Realized Gains/Losses Attributable to Changes in Fair Value at the Balance Sheet Date
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
(138
)
(1) 
Our GLB reinsurance product meets the definition of a derivative instrument for accounting purposes and is accordingly carried at fair value. Excluded from the table above is the portion of the GLB derivative liability classified as Future policy benefits in the consolidated balance sheets. Refer to Note 5 for additional information.
  
Assets
 
 
Liabilities

 
Available-for-Sale Debt Securities
 
 
Equity
securities

 
Other
investments

 
Other
derivative
instruments

 
GLB(1)

Three Months Ended
U.S.
Treasury
and
Agency

 
Foreign

 
Corporate
securities

 
MBS

 
States,
municipalities,
and political
subdivisions

 
 
 
 
September 30, 2012
 
 
 
 
 
 
 
 
(in millions of U.S. dollars)
 
 
 
 
 
 
 
 
Balance–Beginning of Period
$
4

 
$
20

 
$
137

 
$
27

 
$
1

 
$
12

 
$
2,047

 
$
1

 
$
1,354

Transfers into Level 3
—

 
5

 
5

 
10

 
—

 
2

 
53

 
—

 
—

Transfers out of Level 3
(4
)
 
(6
)
 
(26
)
 
—

 
—

 
(10
)
 
—

 
—

 
—

Change in Net Unrealized Gains (Losses) included in OCI
—

 
—

 
3

 
—

 
—

 
(1
)
 
13

 
—

 
—

Net Realized Gains/Losses
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
(75
)
Purchases
—

 
6

 
11

 
—

 
—

 
1

 
121

 
—

 
—

Sales
—

 
—

 
—

 
(7
)
 
—

 
—

 
(5
)
 
—

 
—

Settlements
—

 
—

 
—

 
(1
)
 
—

 
—

 
(51
)
 
(1
)
 
—

Balance–End of Period
$
—

 
$
25

 
$
130

 
$
29

 
$
1

 
$
4

 
$
2,178

 
$
—

 
$
1,279

Net Realized Gains/Losses Attributable to Changes in Fair Value at the Balance Sheet Date
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
(75
)
(1) 
Our GLB reinsurance product meets the definition of a derivative instrument for accounting purposes and is accordingly carried at fair value. Excluded from the table above is the portion of the GLB derivative liability classified as Future policy benefits in the consolidated balance sheets. The liability for GLB reinsurance was $1.5 billion at September 30, 2012, and $1.6 billion at June 30, 2012, which includes a fair value derivative adjustment of $1.3 billion and $1.4 billion, respectively.

 
Assets
Liabilities

Nine Months Ended
Available-for-Sale Debt Securities
Equity
securities

 
Short-term investments

 
Other
investments

 
GLB(1)

 
Foreign

 
Corporate
securities

 
MBS

 
 
 
September 30, 2013
 
 
 
 
 
(in millions of U.S. dollars)
 
 
 
 
 
Balance–Beginning of Period
$
60

 
$
102

 
$
13

 
$
3

 
$
—

 
$
2,252

 
$
1,119

Transfers into Level 3
33

 
29

 
—

 
7

 
8

 
—

 
—

Transfers out of Level 3
(49
)
 
(30
)
 
—

 
(1
)
 
(2
)
 
—

 
—

Change in Net Unrealized Gains (Losses) included in OCI
(2
)
 
(1
)
 
—

 
(5
)
 
—

 
34

 
—

Net Realized Gains/Losses
1

 
(2
)
 
—

 
4

 
—

 
(2
)
 
(605
)
Purchases
15

 
39

 
—

 
1

 
2

 
387

 
—

Sales
(15
)
 
(4
)
 
(3
)
 
(5
)
 
—

 
(10
)
 
—

Settlements
(1
)
 
(12
)
 
(1
)
 
—

 
—

 
(272
)
 
—

Balance–End of Period
$
42

 
$
121

 
$
9

 
$
4

 
$
8

 
$
2,389

 
$
514

Net Realized Gains/Losses Attributable to Changes in Fair Value at the Balance Sheet Date
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
(2
)
 
$
(605
)
(1) 
Our GLB reinsurance product meets the definition of a derivative instrument for accounting purposes and is accordingly carried at fair value. Excluded from the table above is the portion of the GLB derivative liability classified as Future policy benefits in the consolidated balance sheets. Refer to Note 5 for additional information.
  
Assets
 
 
Liabilities

 
Available-for-Sale Debt Securities
 
 
Equity
securities

 
Other
investments

 
Other
derivative
instruments

 
GLB(1)

Nine Months Ended
U.S.
Treasury
and
Agency

 
Foreign

 
Corporate
securities

 
MBS

 
States,
municipalities,
and political
subdivisions

 
 
 
 
September 30, 2012
 
 
 
 
 
 
 
 
(in millions of U.S. dollars)
 
 
 
 
 
 
 
 
Balance–Beginning of Period
$
5

 
$
33

 
$
134

 
$
28

 
$
1

 
$
13

 
$
1,877

 
$
3

 
$
1,319

Transfers into Level 3
—

 
6

 
33

 
22

 
1

 
2

 
53

 
—

 
—

Transfers out of Level 3
(4
)
 
(7
)
 
(35
)
 
(15
)
 
—

 
(10
)
 
—

 
—

 
—

Change in Net Unrealized Gains (Losses) included in OCI
—

 
—

 
6

 
—

 
—

 
—

 
37

 
—

 
—

Net Realized Gains/Losses
—

 
—

 
(1
)
 
—

 
—

 
—

 
(7
)
 
(4
)
 
(40
)
Purchases
—

 
46

 
19

 
4

 
—

 
4

 
366

 
3

 
—

Sales
—

 
(52
)
 
(15
)
 
(7
)
 
—

 
(5
)
 
(6
)
 
—

 
—

Settlements
(1
)
 
(1
)
 
(11
)
 
(3
)
 
(1
)
 
—

 
(142
)
 
(2
)
 
—

Balance–End of Period
$
—

 
$
25

 
$
130

 
$
29

 
$
1

 
$
4

 
$
2,178

 
$
—

 
$
1,279

Net Realized Gains/Losses Attributable to Changes in Fair Value at the Balance Sheet Date
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
(7
)
 
$
—

 
$
(40
)
(1) 
Our GLB reinsurance product meets the definition of a derivative instrument for accounting purposes and is accordingly carried at fair value. Excluded from the table above is the portion of the GLB derivative liability classified as Future policy benefits in the consolidated balance sheets. The liability for GLB reinsurance was $1.5 billion at September 30, 2012 and December 31, 2011, which includes a fair value derivative adjustment of $1.3 billion.
Carrying Values And Fair Values Of Financial Instruments Not Measured At Fair Value 
.

The following tables present fair value, by valuation hierarchy, and carrying value of the financial instruments not measured at fair value:
September 30, 2013
Fair Value
 
 
Carrying Value

(in millions of U.S. dollars)
Level 1

 
Level 2

 
Level 3

 
Total

 
Assets:
 
 
 
 
 
 
 
 
 
Fixed maturities held to maturity
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency
$
615

 
$
244

 
$
—

 
$
859

 
$
842

Foreign
—

 
912

 
—

 
912

 
876

Corporate securities
—

 
2,031

 
16

 
2,047

 
1,960

Mortgage-backed securities
—

 
1,483

 
—

 
1,483

 
1,440

States, municipalities, and political subdivisions
—

 
1,192

 
—

 
1,192

 
1,188

 
615

 
5,862

 
16

 
6,493

 
6,306

Partially-owned insurance companies
—

 
—

 
468

 
468

 
468

Total assets
$
615

 
$
5,862

 
$
484

 
$
6,961

 
$
6,774

Liabilities:
 
 
 
 
 
 
 
 
 
Short-term debt
$
—

 
$
1,920

 
$
—

 
$
1,920

 
$
1,902

Long-term debt
—

 
4,146

 
—

 
4,146

 
3,807

Trust preferred securities
—

 
441

 
—

 
441

 
309

Total liabilities
$
—

 
$
6,507

 
$
—

 
$
6,507

 
$
6,018


December 31, 2012
Fair Value
 
 
Carrying Value

(in millions of U.S. dollars)
Level 1

 
Level 2

 
Level 3

 
Total

 
Assets:
 
 
 
 
 
 
 
 
 
Fixed maturities held to maturity
 
 
 
 
 
 
 
 
 
U.S. Treasury and agency
$
619

 
$
464

 
$
—

 
$
1,083

 
$
1,044

Foreign
—

 
964

 
—

 
964

 
910

Corporate securities
—

 
2,257

 
18

 
2,275

 
2,133

Mortgage-backed securities
—

 
2,116

 
—

 
2,116

 
2,028

States, municipalities, and political subdivisions
—

 
1,195

 
—

 
1,195

 
1,155

 
619

 
6,996

 
18

 
7,633

 
7,270

Partially-owned insurance companies
—

 
—

 
454

 
454

 
454

Total assets
$
619

 
$
6,996

 
$
472

 
$
8,087

 
$
7,724

Liabilities:
 
 
 
 
 
 
 
 
 
Short-term debt
$
—

 
$
1,401

 
$
—

 
$
1,401

 
$
1,401

Long-term debt
—

 
3,916

 
—

 
3,916

 
3,360

Trust preferred securities
—

 
446

 
—

 
446

 
309

Total liabilities
$
—

 
$
5,763

 
$
—

 
$
5,763

 
$
5,070

Assumed life reinsurance programs involving minimum benefit guarantees under annuity contracts (Tables)
Schedule Of Guaranteed Minimum Death Benefits And Guaranteed Minimum Income Benefits Income And Expense
 
Three Months Ended
 
 
Nine Months Ended
 
 
September 30
 
 
September 30
 
(in millions of U.S. dollars)
2013

 
2012

 
2013

 
2012

GMDB
 
 
 
 
 
 
 
Net premiums earned
$
19

 
$
20

 
$
59

 
$
64

Policy benefits and other reserve adjustments
$
14

 
$
22

 
$
58

 
$
61

GLB
 
 
 
 
 
 
 
Net premiums earned
$
36

 
$
40

 
$
112

 
$
121

Policy benefits and other reserve adjustments
9

 
7

 
20

 
30

Net realized gains (losses)
138

 
75

 
608

 
41

Gain recognized in income
$
165

 
$
108

 
$
700

 
$
132

Net cash received
$
31

 
$
35

 
$
94

 
$
114

Net decrease in liability
$
134

 
$
73

 
$
606

 
$
18

Commitments, contingencies, and guarantees (Tables)
Balance Sheet Locations, Fair Values In An Asset Or (Liability) Position, And Notional Values/Payment Provisions Of Derivative Instruments 
 
 
 
September 30
 
 
December 31
 
 
 
 
2013
 
 
2012
 
(in millions of U.S. dollars)
Consolidated
Balance Sheet
Location
 
Fair
Value

 
Notional
Value/
Payment
Provision

 
Fair
Value

 
Notional
Value/
Payment
Provision

Investment and embedded derivative instruments
 
 
 
 
 
 
 
 
 
Foreign currency forward contracts
AP
 
$
(7
)
 
$
1,205

 
$
—

 
$
620

Cross-currency swaps
AP
 
—

 
50

 
—

 
50

Futures contracts on money market instruments
AP
 
2

 
3,910

 
1

 
2,710

Futures contracts on notes and bonds
AP
 
(13
)
 
1,022

 
10

 
915

Convertible bonds
FM AFS
 
291

 
242

 
309

 
279

TBAs
FM AFS
 
25

 
24

 
—

 
—

 
 
 
$
298

 
$
6,453

 
$
320

 
$
4,574

Other derivative instruments
 
 
 
 
 
 
 
 
 
Futures contracts on equities(1)
AP
 
$
7

 
$
1,585

 
$
(6
)
 
$
2,308

Options on equity market indices(1)
AP
 
10

 
250

 
30

 
250

Other
AP
 
(2
)
 
13

 
—

 
—

 
 
 
$
15

 
$
1,848

 
$
24

 
$
2,558

GLB(2)
AP/FPB
 
$
(746
)
 
$
461

 
$
(1,352
)
 
$
1,100

(1) 
Related to GMDB and GLB blocks of business.
(2) 
Includes both future policy benefits reserves and fair value derivative adjustment. Refer to Note 5 for additional information. Note that the payment provision related to GLB is the net amount at risk. The concept of a notional value does not apply to the GLB reinsurance contracts.
Net Realized Gains (Losses) Of Derivative Instrument Activity In Consolidated Statement Of Operations 
atements of operations:
 
Three Months Ended
 
 
Nine Months Ended
 
 
September 30
 
 
September 30
 
(in millions of U.S. dollars)
2013

 
2012

 
2013

 
2012

Investment and embedded derivative instruments
 
 
 
 
 
 
 
Foreign currency forward contracts
$
(9
)
 
$
(9
)
 
$
8

 
$
(8
)
All other futures contracts and options
6

 
—

 
46

 
(20
)
Convertible bonds
6

 
12

 
7

 
24

TBAs
1

 
1

 
1

 
1

Total investment and embedded derivative instruments
$
4

 
$
4

 
$
62

 
$
(3
)
GLB and other derivative instruments
 
 
 
 
 
 
 
GLB(1)
$
134

 
$
83

 
$
563

 
$
44

Futures contracts on equities(2)
(90
)
 
(138
)
 
(393
)
 
(286
)
Options on equity market indices(2)
(5
)
 
(9
)
 
(20
)
 
(22
)
Other
(1
)
 
—

 
(2
)
 
(4
)
Total GLB and other derivative instruments
$
38

 
$
(64
)
 
$
148

 
$
(268
)
 
$
42

 
$
(60
)
 
$
210

 
$
(271
)
(1) 
Excludes foreign exchange gains (losses) related to GLB.
(2) 
Related to GMDB and
Segment information (Tables)
Operations By Segment 
Statement of Operations by Segment
For the Three Months Ended September 30, 2013
Insurance – North American P&C

 
Insurance – North American Agriculture

 
Insurance –
Overseas
General

 
Global
Reinsurance

 
Life

 
Corporate
and Other

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
 
 
Net premiums written
$
1,500

 
$
805

 
$
1,571

 
$
265

 
$
479

 
$
—

 
$
4,620

Net premiums earned
1,444

 
849

 
1,611

 
239

 
467

 
—

 
4,610

Losses and loss expenses
963

 
746

 
712

 
93

 
141

 
—

 
2,655

Policy benefits
—

 
—

 
—

 
—

 
138

 
—

 
138

Policy acquisition costs
159

 
32

 
349

 
52

 
86

 
—

 
678

Administrative expenses
153

 
5

 
263

 
12

 
85

 
45

 
563

Underwriting income (loss)
169

 
66

 
287

 
82

 
17

 
(45
)
 
576

Net investment income
254

 
6

 
128

 
66

 
61

 
7

 
522

Net realized gains (losses) including OTTI
9

 
—

 
(8
)
 
(5
)
 
43

 
1

 
40

Interest expense
3

 
—

 
1

 
2

 
4

 
62

 
72

Other (income) expense:
 
 
 
 
 
 
 
 
 
 
 
 
 
(Gains) losses from fair value changes in separate account assets
—

 
—

 
—

 
—

 
(14
)
 
—

 
(14
)
Other
(13
)
 
8

 
14

 
(7
)
 
4

 
3

 
9

Income tax expense (benefit)
79

 
14

 
78

 
16

 
10

 
(42
)
 
155

Net income (loss)
$
363

 
$
50

 
$
314

 
$
132

 
$
117

 
$
(60
)
 
$
916


Statement of Operations by Segment
For the Three Months Ended September 30, 2012
Insurance – North American P&C

 
Insurance – North American Agriculture

 
Insurance –
Overseas
General

 
Global
Reinsurance

 
Life

 
Corporate
and Other

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
 
 
 
Net premiums written
$
1,373

 
$
1,164

 
$
1,384

 
$
307

 
$
488

 
$
—

 
$
4,716

Net premiums earned
1,306

 
1,166

 
1,432

 
281

 
480

 
—

 
4,665

Losses and loss expenses
819

 
1,291

 
622

 
151

 
164

 
—

 
3,047

Policy benefits
—

 
—

 
—

 
—

 
130

 
—

 
130

Policy acquisition costs
147

 
13

 
329

 
40

 
80

 
—

 
609

Administrative expenses
148

 
—

 
234

 
13

 
81

 
43

 
519

Underwriting income (loss)
192

 
(138
)
 
247

 
77

 
25

 
(43
)
 
360

Net investment income
257

 
6

 
127

 
72

 
63

 
8

 
533

Net realized gains (losses) including OTTI
(2
)
 
1

 
13

 
(2
)
 
(71
)
 
1

 
(60
)
Interest expense
3

 
—

 
2

 
1

 
3

 
54

 
63

Other (income) expense:
 
 
 
 
 
 
 
 
 
 
 
 
 
(Gains) losses from fair value changes in separate account assets
—

 
—

 
—

 
—

 
(14
)
 
—

 
(14
)
Other
(13
)
 
8

 
(3
)
 
(5
)
 
—

 
10

 
(3
)
Income tax expense (benefit)
129

 
(48
)
 
77

 
11

 
14

 
(36
)
 
147

Net income (loss)
$
328

 
$
(91
)
 
$
311

 
$
140

 
$
14

 
$
(62
)
 
$
640


Statement of Operations by Segment
For the Nine Months Ended September 30, 2013
Insurance – North American P&C

 
Insurance – North American Agriculture

 
Insurance –
Overseas
General

 
Global
Reinsurance

 
Life

 
Corporate
and Other

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
 
 
 
Net premiums written
$
4,313

 
$
1,371

 
$
4,821

 
$
836

 
$
1,468

 
$
—

 
$
12,809

Net premiums earned
4,210

 
1,252

 
4,633

 
731

 
1,424

 
—

 
12,250

Losses and loss expenses
2,791

 
1,071

 
2,227

 
292

 
443

 
7

 
6,831

Policy benefits
—

 
—

 
—

 
—

 
379

 
—

 
379

Policy acquisition costs
444

 
56

 
1,048

 
148

 
261

 
—

 
1,957

Administrative expenses
437

 
13

 
750

 
36

 
256

 
149

 
1,641

Underwriting income (loss)
538

 
112

 
608

 
255

 
85

 
(156
)
 
1,442

Net investment income
755

 
19

 
396

 
209

 
187

 
21

 
1,587

Net realized gains (losses) including OTTI
63

 
1

 
34

 
46

 
206

 
—

 
350

Interest expense
4

 
—

 
4

 
4

 
12

 
181

 
205

Other (income) expense:


 


 


 


 


 


 
 
(Gains) losses from fair value changes in separate account assets
—

 
—

 
—

 
—

 
(7
)
 
—

 
(7
)
Other
(38
)
 
24

 
30

 
(13
)
 
7

 
19

 
29

Income tax expense (benefit)
264

 
24

 
174

 
31

 
33

 
(134
)
 
392

Net income (loss)
$
1,126

 
$
84

 
$
830

 
$
488

 
$
433

 
$
(201
)
 
$
2,760


Statement of Operations by Segment
For the Nine Months Ended September 30, 2012
Insurance – North American P&C

 
Insurance – North American Agriculture

 
Insurance –
Overseas
General

 
Global
Reinsurance

 
Life

 
Corporate
and Other

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
 
 
 
Net premiums written
$
3,915

 
$
1,775

 
$
4,387

 
$
879

 
$
1,462

 
$
—

 
$
12,418

Net premiums earned
3,802

 
1,609

 
4,243

 
748

 
1,427

 
—

 
11,829

Losses and loss expenses
2,474

 
1,648

 
2,030

 
355

 
463

 
—

 
6,970

Policy benefits
—

 
—

 
—

 
—

 
379

 
—

 
379

Policy acquisition costs
419

 
25

 
996

 
125

 
244

 
1

 
1,810

Administrative expenses
451

 
(3
)
 
696

 
38

 
237

 
124

 
1,543

Underwriting income (loss)
458

 
(61
)
 
521

 
230

 
104

 
(125
)
 
1,127

Net investment income
789

 
19

 
386

 
213

 
186

 
21

 
1,614

Net realized gains (losses) including OTTI
15

 
1

 
59

 
(6
)
 
(261
)
 
(2
)
 
(194
)
Interest expense
9

 
—

 
4

 
3

 
9

 
162

 
187

Other (income) expense:
 
 
 
 
 
 
 
 
 
 
 
 
 
(Gains) losses from fair value changes in separate account assets
—

 
—

 
—

 
—

 
(18
)
 
—

 
(18
)
Other
(20
)
 
24

 
3

 
(7
)
 
14

 
18

 
32

Income tax expense (benefit)
308

 
(29
)
 
166

 
17

 
44

 
(101
)
 
405

Net income (loss)
$
965

 
$
(36
)
 
$
793

 
$
424

 
$
(20
)
 
$
(185
)
 
$
1,941

Net Premiums Earned For Segment By Product 
For the Three Months Ended September 30, 2013
Property &
All Other

 
Casualty

 
Life,
Accident &
Health

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
Insurance – North American P&C
$
388

 
$
957

 
$
99

 
$
1,444

Insurance – North American Agriculture
849

 
—

 
—

 
849

Insurance – Overseas General
689

 
375

 
547

 
1,611

Global Reinsurance
141

 
98

 
—

 
239

Life
—

 
—

 
467

 
467

 
$
2,067

 
$
1,430

 
$
1,113

 
$
4,610


For the Three Months Ended September 30, 2012
Property &
All Other

 
Casualty

 
Life,
Accident &
Health

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
Insurance – North American P&C
$
353

 
$
860

 
$
93

 
$
1,306

Insurance – North American Agriculture
1,166

 
—

 
—

 
1,166

Insurance – Overseas General
547

 
356

 
529

 
1,432

Global Reinsurance
131

 
150

 
—

 
281

Life
—

 
—

 
480

 
480

 
$
2,197

 
$
1,366

 
$
1,102

 
$
4,665


For the Nine Months Ended September 30, 2013
Property &
All Other

 
Casualty

 
Life,
Accident &
Health

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
Insurance – North American P&C
$
1,103

 
$
2,826

 
$
281

 
$
4,210

Insurance – North American Agriculture
1,252

 
—

 
—

 
1,252

Insurance – Overseas General
1,932

 
1,088

 
1,613

 
4,633

Global Reinsurance
408

 
323

 
—

 
731

Life
—

 
—

 
1,424

 
1,424

 
$
4,695

 
$
4,237

 
$
3,318

 
$
12,250



For the Nine Months Ended September 30, 2012
Property &
All Other

 
Casualty

 
Life,
Accident &
Health

 
ACE
Consolidated

(in millions of U.S. dollars)
 
 
 
Insurance – North American P&C
$
1,022

 
$
2,505

 
$
275

 
$
3,802

Insurance – North American Agriculture
1,609

 
—

 
—

 
1,609

Insurance – Overseas General
1,637

 
1,027

 
1,579

 
4,243

Global Reinsurance
355

 
393

 
—

 
748

Life
—

 
—

 
1,427

 
1,427

 
$
4,623

 
$
3,925

 
$
3,281

 
$
11,829

Earnings per share (Tables)
Schedule Of Earnings Per Share, Basic And Diluted
 
Three Months Ended
 
 
Nine Months Ended
 
 
September 30
 
 
September 30
 
(in millions of U.S. dollars, except share and per share data)
2013

 
2012

 
2013

 
2012

Numerator:
 
 
 
 
 
 
 
Net income
$
916

 
$
640

 
$
2,760

 
$
1,941

Denominator:
 
 
 
 
 
 
 
Denominator for basic earnings per share:
 
 
 
 
 
 
 
Weighted-average shares outstanding
340,888,648

 
340,207,037

 
340,905,322

 
339,523,388

Denominator for diluted earnings per share:
 
 
 
 

 

Share-based compensation plans
2,929,089

 
2,665,676

 
3,146,728

 
2,831,798

Weighted-average shares outstanding and assumed conversions
343,817,737

 
342,872,713

 
344,052,050

 
342,355,186

Basic earnings per share
$
2.68

 
$
1.88

 
$
8.09

 
$
5.71

Diluted earnings per share
$
2.66

 
$
1.86

 
$
8.02

 
$
5.67

 
 
 
 
 
 
 
 
Potential anti-dilutive share conversions
1,215,884

 
1,449,610

 
1,429,514

 
1,193,839

Information provided in connection with outstanding debt of subsidiaries (Tables)
Condensed Consolidating Balance Sheet 
Condensed Consolidating Balance Sheet at September 30, 2013
(in millions of U.S. dollars)
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE Limited
Consolidated

Assets
 
 
 
 
 
 
 
 
 
Investments
$
29

 
$
10

 
$
60,303

 
$
—

 
$
60,342

Cash(1)
11

 
165

 
1,464

 
(872
)
 
768

Insurance and reinsurance balances receivable
—

 
—

 
6,225

 
(1,136
)
 
5,089

Reinsurance recoverable on losses and loss expenses
—

 
—

 
20,279

 
(8,802
)
 
11,477

Reinsurance recoverable on policy benefits
—

 
—

 
1,246

 
(1,009
)
 
237

Value of business acquired
—

 
—

 
554

 
—

 
554

Goodwill and other intangible assets
—

 
—

 
5,465

 
—

 
5,465

Investments in subsidiaries
28,457

 
17,979

 
—

 
(46,436
)
 
—

Due from subsidiaries and affiliates, net
813

 
—

 
—

 
(813
)
 
—

Other assets
5

 
219

 
12,679

 
(2,251
)
 
10,652

Total assets
$
29,315

 
$
18,373

 
$
108,215

 
$
(61,319
)
 
$
94,584

Liabilities
 
 
 
 
 
 
 
 
 
Unpaid losses and loss expenses
$
—

 
$
—

 
$
46,215

 
$
(8,333
)
 
$
37,882

Unearned premiums
—

 
—

 
9,523

 
(1,729
)
 
7,794

Future policy benefits
—

 
—

 
5,605

 
(1,009
)
 
4,596

Due to (from) subsidiaries and affiliates, net
—

 
661

 
152

 
(813
)
 
—

Affiliated notional cash pooling programs(1)
872

 
—

 
—

 
(872
)
 
—

Short-term debt
—

 
500

 
1,402

 
—

 
1,902

Long-term debt
—

 
3,795

 
12

 
—

 
3,807

Trust preferred securities
—

 
309

 
—

 
—

 
309

Other liabilities
225

 
1,342

 
10,636

 
(2,127
)
 
10,076

Total liabilities
1,097

 
6,607

 
73,545

 
(14,883
)
 
66,366

Total shareholders’ equity
28,218

 
11,766

 
34,670

 
(46,436
)
 
28,218

Total liabilities and shareholders’ equity
$
29,315

 
$
18,373

 
$
108,215

 
$
(61,319
)
 
$
94,584


(1) 
ACE maintains two notional multicurrency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At September 30, 2013, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.
 




Condensed Consolidating Balance Sheet at December 31, 2012 (Revised)

(in millions of U.S. dollars)
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE Limited
Consolidated

Assets
 
 
 
 
 
 
 
 
 
Investments
$
31

 
$
14

 
$
60,219

 
$
—

 
$
60,264

Cash(1)
103

 
2

 
859

 
(349
)
 
615

Insurance and reinsurance balances receivable
—

 
—

 
4,742

 
(595
)
 
4,147

Reinsurance recoverable on losses and loss expenses
—

 
—

 
20,935

 
(8,857
)
 
12,078

Reinsurance recoverable on policy benefits
—

 
—

 
1,229

 
(988
)
 
241

Value of business acquired
—

 
—

 
614

 
—

 
614

Goodwill and other intangible assets
—

 
—

 
4,975

 
—

 
4,975

Investments in subsidiaries
27,251

 
17,016

 
—

 
(44,267
)
 
—

Due from subsidiaries and affiliates, net
204

 
—

 
—

 
(204
)
 
—

Other assets
13

 
210

 
11,304

 
(1,916
)
 
9,611

Total assets
$
27,602

 
$
17,242

 
$
104,877

 
$
(57,176
)
 
$
92,545

Liabilities
 
 
 
 
 
 
 
 
 
Unpaid losses and loss expenses
$
—

 
$
—

 
$
46,109

 
$
(8,163
)
 
$
37,946

Unearned premiums
—

 
—

 
8,248

 
(1,384
)
 
6,864

Future policy benefits
—

 
—

 
5,458

 
(988
)
 
4,470

Due to (from) subsidiaries and affiliates, net
—

 
68

 
136

 
(204
)
 
—

Affiliated notional cash pooling programs(1)
—

 
349

 
—

 
(349
)
 
—

Short-term debt
—

 
—

 
1,401

 
—

 
1,401

Long-term debt
—

 
3,347

 
13

 
—

 
3,360

Trust preferred securities
—

 
309

 
—

 
—

 
309

Other liabilities
71

 
1,195

 
11,219

 
(1,821
)
 
10,664

Total liabilities
71

 
5,268

 
72,584

 
(12,909
)
 
65,014

Total shareholders’ equity
27,531

 
11,974

 
32,293

 
(44,267
)
 
27,531

Total liabilities and shareholders’ equity
$
27,602

 
$
17,242

 
$
104,877

 
$
(57,176
)
 
$
92,545

(1) 
ACE maintains two notional multicurrency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At December 31, 2012, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.
Condensed Consolidating Balance Sheet at December 31, 2012 (As previously reported)

(in millions of U.S. dollars)
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries and
Eliminations(1)

 
Consolidating
Adjustments(2)

 
ACE Limited
Consolidated

Assets
 
 
 
 
 
 
 
 
 
Investments
$
31

 
$
31,074

 
$
29,159

 
$
—

 
$
60,264

Cash(3)
103

 
515

 
(3
)
 
—

 
615

Insurance and reinsurance balances receivable
—

 
3,654

 
493

 
—

 
4,147

Reinsurance recoverable on losses and loss expenses
—

 
17,232

 
(5,154
)
 
—

 
12,078

Reinsurance recoverable on policy benefits
—

 
1,187

 
(946
)
 
—

 
241

Value of business acquired
—

 
610

 
4

 
—

 
614

Goodwill and other intangible assets
—

 
4,419

 
556

 
—

 
4,975

Investments in subsidiaries
27,251

 
—

 
—

 
(27,251
)
 
—

Due from subsidiaries and affiliates, net
204

 
—

 
—

 
(204
)
 
—

Other assets
13

 
7,563

 
2,035

 
—

 
9,611

Total assets
$
27,602

 
$
66,254

 
$
26,144

 
$
(27,455
)
 
$
92,545

Liabilities
 
 
 
 
 
 
 
 
 
Unpaid losses and loss expenses
$
—

 
$
31,356

 
$
6,590

 
$
—

 
$
37,946

Unearned premiums
—

 
5,872

 
992

 
—

 
6,864

Future policy benefits
—

 
3,876

 
594

 
—

 
4,470

Due to (from) subsidiaries and affiliates, net
—

 
384

 
(180
)
 
(204
)
 
—

Short-term debt
—

 
851

 
550

 
—

 
1,401

Long-term debt
—

 
3,360

 
—

 
—

 
3,360

Trust preferred securities
—

 
309

 
—

 
—

 
309

Other liabilities
71

 
8,272

 
2,321

 
—

 
10,664

Total liabilities
71

 
54,280

 
10,867

 
(204
)
 
65,014

Total shareholders’ equity
27,531

 
11,974

 
15,277

 
(27,251
)
 
27,531

Total liabilities and shareholders’ equity
$
27,602

 
$
66,254

 
$
26,144

 
$
(27,455
)
 
$
92,545

(1)
Includes all other subsidiaries of ACE Limited and intercompany eliminations, primarily intercompany reinsurance transactions.
(2)
Includes ACE Limited parent company eliminations.
(3)
ACE maintains two notional multicurrency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At December 31, 2012, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.

Condensed Consolidating Statement Of Operations and Comprehensive Income 
Condensed Consolidating Statements of Operations and Comprehensive Income
For the Three Months Ended September 30, 2013
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net premiums written
$
—

 
$
—

 
$
4,620

 
$
—

 
$
4,620

Net premiums earned
—

 
—

 
4,610

 
—

 
4,610

Net investment income
1

 
—

 
521

 
—

 
522

Equity in earnings of subsidiaries
863

 
322

 
—

 
(1,185
)
 
—

Net realized gains (losses) including OTTI
—

 
(2
)
 
42

 
—

 
40

Losses and loss expenses
—

 
—

 
2,655

 
—

 
2,655

Policy benefits
—

 
—

 
138

 
—

 
138

Policy acquisition costs and administrative expenses
13

 
4

 
1,224

 
—

 
1,241

Interest (income) expense
(8
)
 
69

 
11

 
—

 
72

Other (income) expense
(62
)
 
6

 
51

 
—

 
(5
)
Income tax expense (benefit)
5

 
(14
)
 
164

 
—

 
155

Net income
$
916

 
$
255

 
$
930

 
$
(1,185
)
 
$
916

Comprehensive income
$
1,030

 
$
339

 
$
1,043

 
$
(1,382
)
 
$
1,030



Condensed Consolidating Statements of Operations and Comprehensive Income (Revised)
For the Three Months Ended September 30, 2012
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net premiums written
$
—

 
$
—

 
$
4,716

 
$
—

 
$
4,716

Net premiums earned
—

 
—

 
4,665

 
—

 
4,665

Net investment income
—

 
1

 
532

 
—

 
533

Equity in earnings of subsidiaries
616

 
285

 
—

 
(901
)
 
—

Net realized gains (losses) including OTTI
(4
)
 
—

 
(56
)
 
—

 
(60
)
Losses and loss expenses
—

 
—

 
3,047

 
—

 
3,047

Policy benefits
—

 
—

 
130

 
—

 
130

Policy acquisition costs and administrative expenses
16

 
6

 
1,106

 
—

 
1,128

Interest (income) expense
(8
)
 
60

 
11

 
—

 
63

Other (income) expense
(39
)
 
7

 
15

 
—

 
(17
)
Income tax expense (benefit)
3

 
(24
)
 
168

 
—

 
147

Net income
$
640

 
$
237

 
$
664

 
$
(901
)
 
$
640

Comprehensive income
$
1,316

 
$
593

 
$
1,339

 
$
(1,932
)
 
$
1,316



Condensed Consolidating Statements of Operations and Comprehensive Income (As previously reported)
For the Three Months Ended September 30, 2012
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries and
Eliminations(1)

 
Consolidating
Adjustments (2)

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net premiums written
$
—

 
$
2,868

 
$
1,848

 
$
—

 
$
4,716

Net premiums earned
—

 
2,819

 
1,846

 
—

 
4,665

Net investment income
—

 
255

 
278

 
—

 
533

Equity in earnings of subsidiaries
616

 
—

 
—

 
(616
)
 
—

Net realized gains (losses) including OTTI
(4
)
 
11

 
(67
)
 
—

 
(60
)
Losses and loss expenses
—

 
1,977

 
1,070

 
—

 
3,047

Policy benefits
—

 
77

 
53

 
—

 
130

Policy acquisition costs and administrative expenses
16

 
587

 
525

 
—

 
1,128

Interest (income) expense
(8
)
 
67

 
4

 
—

 
63

Other (income) expense
(39
)
 
17

 
5

 
—

 
(17
)
Income tax expense
3

 
123

 
21

 
—

 
147

Net income
$
640

 
$
237

 
$
379

 
$
(616
)
 
$
640

Comprehensive income
$
1,316

 
$
593

 
$
23

 
$
(616
)
 
$
1,316

(1)
Includes all other subsidiaries of ACE Limited and intercompany eliminations.
(2)
Includes ACE Limited parent company eliminations.


Condensed Consolidating Statements of Operations and Comprehensive Income (Loss)
For the Nine Months Ended September 30, 2013
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net premiums written
$
—

 
$
—

 
$
12,809

 
$
—

 
$
12,809

Net premiums earned
—

 
—

 
12,250

 
—

 
12,250

Net investment income
2

 
2

 
1,583

 
—

 
1,587

Equity in earnings of subsidiaries
2,619

 
767

 
—

 
(3,386
)
 
—

Net realized gains (losses) including OTTI
12

 
(2
)
 
340

 
—

 
350

Losses and loss expenses
—

 
—

 
6,831

 
—

 
6,831

Policy benefits
—

 
—

 
379

 
—

 
379

Policy acquisition costs and administrative expenses
40

 
13

 
3,545

 
—

 
3,598

Interest (income) expense
(23
)
 
200

 
28

 
—

 
205

Other (income) expense
(157
)
 
21

 
158

 
—

 
22

Income tax expense (benefit)
13

 
(80
)
 
459

 
—

 
392

Net income
$
2,760

 
$
613

 
$
2,773

 
$
(3,386
)
 
$
2,760

Comprehensive income (loss)
$
1,247

 
$
(195
)
 
$
1,259

 
$
(1,064
)
 
$
1,247



Condensed Consolidating Statements of Operations and Comprehensive Income (Revised)
For the Nine Months Ended September 30, 2012
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net premiums written
$
—

 
$
—

 
$
12,418

 
$
—

 
$
12,418

Net premiums earned
—

 
—

 
11,829

 
—

 
11,829

Net investment income
1

 
2

 
1,611

 
—

 
1,614

Equity in earnings of subsidiaries
1,845

 
775

 
—

 
(2,620
)
 
—

Net realized gains (losses) including OTTI
18

 
—

 
(212
)
 
—

 
(194
)
Losses and loss expenses
—

 
—

 
6,970

 
—

 
6,970

Policy benefits
—

 
—

 
379

 
—

 
379

Policy acquisition costs and administrative expenses
42

 
20

 
3,291

 
—

 
3,353

Interest (income) expense
(25
)
 
175

 
37

 
—

 
187

Other (income) expense
(102
)
 
(8
)
 
124

 
—

 
14

Income tax expense (benefit)
8

 
(72
)
 
469

 
—

 
405

Net income
$
1,941

 
$
662

 
$
1,958

 
$
(2,620
)
 
$
1,941

Comprehensive income
$
3,044

 
$
1,203

 
$
3,060

 
$
(4,263
)
 
$
3,044



Condensed Consolidating Statements of Operations and Comprehensive Income (As previously reported)
For the Nine Months Ended September 30, 2012
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries and
Eliminations(1)

 
Consolidating
Adjustments (2)

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net premiums written
$
—

 
$
7,293

 
$
5,125

 
$
—

 
$
12,418

Net premiums earned
—

 
6,967

 
4,862

 
—

 
11,829

Net investment income
1

 
777

 
836

 
—

 
1,614

Equity in earnings of subsidiaries
1,845

 
—

 
—

 
(1,845
)
 
—

Net realized gains (losses) including OTTI
18

 
71

 
(283
)
 
—

 
(194
)
Losses and loss expenses
—

 
4,484

 
2,486

 
—

 
6,970

Policy benefits
—

 
217

 
162

 
—

 
379

Policy acquisition costs and administrative expenses
42

 
1,883

 
1,428

 
—

 
3,353

Interest (income) expense
(25
)
 
191

 
21

 
—

 
187

Other (income) expense
(102
)
 
51

 
65

 
—

 
14

Income tax expense
8

 
327

 
70

 
—

 
405

Net income
$
1,941

 
$
662

 
$
1,183

 
$
(1,845
)
 
$
1,941

Comprehensive income
$
3,044

 
$
1,203

 
$
642

 
$
(1,845
)
 
$
3,044

(1)
Includes all other subsidiaries of ACE Limited and intercompany eliminations.
(2)
Includes ACE Limited parent company eliminations.

Condensed Consolidating Statement of Cash Flows 
Condensed Consolidating Statement of Cash Flows
For the Nine Months Ended September 30, 2013
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net cash flows from (used for) operating activities
$
80

 
$
2

 
$
2,654

 
$
—

 
$
2,736

Cash flows from investing activities
 
 
 
 
 
 
 
 
 
Purchases of fixed maturities available for sale and net change in short-term investments
—

 
4

 
(15,996
)
 
103

 
(15,889
)
Purchases of fixed maturities held to maturity
—

 
—

 
(374
)
 
—

 
(374
)
Purchases of equity securities
—

 
—

 
(217
)
 
—

 
(217
)
Sales of fixed maturities available for
sale
—

 
—

 
8,115

 
(103
)
 
8,012

Sales of equity securities
—

 
—

 
99

 
—

 
99

Maturities and redemptions of fixed maturities available for sale
—

 
—

 
5,538

 
—

 
5,538

Maturities and redemptions of fixed maturities held to maturity
—

 
—

 
1,233

 
—

 
1,233

Net derivative instruments settlements
—

 
(1
)
 
(375
)
 
—

 
(376
)
Acquisition of subsidiaries (net of cash acquired of $38)
—

 
—

 
(977
)
 
—

 
(977
)
Capital contribution
(133
)
 
(1,010
)
 
—

 
1,143

 
—

Other
—

 
(5
)
 
(183
)
 
—

 
(188
)
Net cash flows used for investing activities
(133
)
 
(1,012
)
 
(3,137
)
 
1,143

 
(3,139
)
Cash flows from financing activities
 
 
 
 
 
 
 
 
 
Dividends paid on Common Shares
(343
)
 
—

 
—

 
—

 
(343
)
Common Shares repurchased
—

 
—

 
(233
)
 
—

 
(233
)
Proceeds from issuance of long-term debt
—

 
947

 
—

 
—

 
947

Net proceeds from issuance of short-term debt
—

 
—

 
1

 
—

 
1

Proceeds from share-based compensation plans, including windfall tax benefits
7

 
—

 
105

 
—

 
112

Advances (to) from affiliates
(575
)
 
575

 
—

 
—

 
—

Capital contribution
—

 
—

 
1,143

 
(1,143
)
 
—

Net proceeds from (payments to) affiliated notional cash pooling programs(1)
872

 
(349
)
 
—

 
(523
)
 
—

Other
—

 
—

 
68

 
—

 
68

Net cash flows from (used for) financing activities
(39
)
 
1,173

 
1,084

 
(1,666
)
 
552

Effect of foreign currency rate changes on cash and cash equivalents
—

 
—

 
4

 
—

 
4

Net (decrease) increase in cash
(92
)
 
163

 
605

 
(523
)
 
153

Cash – beginning of period(1)
103

 
2

 
859

 
(349
)
 
615

Cash – end of period(1)
$
11

 
$
165

 
$
1,464

 
$
(872
)
 
$
768

(1) 
ACE maintains two notional multicurrency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At September 30, 2013 and December 31, 2012, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.

Condensed Consolidating Statement of Cash Flows (Revised)
For the Nine Months Ended September 30, 2012
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries

 
Consolidating
Adjustments and Eliminations

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net cash flows from operating activities
$
136

 
$
127

 
$
2,882

 
$
(120
)
 
$
3,025

Cash flows from investing activities
 
 
 
 
 
 
 
 
 
Purchases of fixed maturities available for sale and net change in short-term investments
—

 
—

 
(17,803
)
 
147

 
(17,656
)
Purchases of fixed maturities held to maturity
—

 
—

 
(217
)
 
—

 
(217
)
Purchases of equity securities
—

 
—

 
(114
)
 
—

 
(114
)
Sales of fixed maturities available for sale
—

 
—

 
11,502

 
(147
)
 
11,355

Sales of equity securities
—

 
—

 
57

 
—

 
57

Maturities and redemptions of fixed maturities available for sale
—

 
—

 
3,596

 
—

 
3,596

Maturities and redemptions of fixed maturities held to maturity
—

 
—

 
1,092

 
—

 
1,092

Net derivative instruments settlements
(1
)
 
—

 
(357
)
 
—

 
(358
)
Acquisition of subsidiaries (net of cash acquired of $8)
—

 
—

 
(98
)
 
—

 
(98
)
Capital contribution
—

 
(89
)
 
(90
)
 
179

 
—

Other
—

 
(2
)
 
(337
)
 
—

 
(339
)
Net cash flows used for investing activities
(1
)
 
(91
)
 
(2,769
)
 
179

 
(2,682
)
Cash flows from financing activities
 
 
 
 
 
 
 
 
 
Dividends paid on Common Shares
(484
)
 
—

 
—

 
—

 
(484
)
Common Shares repurchased
—

 
—

 
(11
)
 
—

 
(11
)
Net proceeds from issuance of short-term debt
—

 
—

 
151

 
—

 
151

Proceeds from share-based compensation plans
17

 
—

 
56

 
—

 
73

Advances (to) from affiliates
110

 
(106
)
 
(4
)
 
—

 
—

Dividends to parent company
—

 
—

 
(120
)
 
120

 
—

Capital contribution
—

 
90

 
89

 
(179
)
 
—

Net proceeds from (payments to) affiliated notional cash pooling programs(1)
116

 
7

 
—

 
(123
)
 
—

Net cash flows from (used for) financing activities
(241
)
 
(9
)
 
161

 
(182
)
 
(271
)
Effect of foreign currency rate changes on cash and cash equivalents
—

 
—

 
4

 
—

 
4

Net increase (decrease) in cash
(106
)
 
27

 
278

 
(123
)
 
76

Cash – beginning of period(1)
106

 
5

 
651

 
(148
)
 
614

Cash – end of period(1)
$
—

 
$
32

 
$
929

 
$
(271
)
 
$
690


(1) 
ACE maintains two notional multicurrency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At September 30, 2012 and December 31, 2011, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.
Condensed Consolidating Statement of Cash Flows (As previously reported)
For the Nine Months Ended September 30, 2012
ACE
Limited
(Parent
Guarantor)

 
ACE INA
Holdings Inc.
(Subsidiary
Issuer)

 
Other ACE
Limited
Subsidiaries and
Eliminations(1)

 
Consolidating
Adjustments(2)

 
ACE
Limited
Consolidated

(in millions of U.S. dollars)
 
 
 
 
Net cash flows from operating activities
$
210

 
$
1,553

 
$
1,262

 
$
—

 
$
3,025

Cash flows from investing activities
 
 
 
 
 
 
 
 
 
Purchases of fixed maturities available for sale
—

 
(8,553
)
 
(9,103
)
 
—

 
(17,656
)
Purchases of fixed maturities held to maturity
—

 
(215
)
 
(2
)
 
—

 
(217
)
Purchases of equity securities
—

 
(65
)
 
(49
)
 
—

 
(114
)
Sales of fixed maturities available for sale
—

 
5,154

 
6,201

 
—

 
11,355

Sales of equity securities
—

 
48

 
9

 
—

 
57

Maturities and redemptions of fixed maturities available for sale
—

 
1,757

 
1,839

 
—

 
3,596

Maturities and redemptions of fixed maturities held to maturity
—

 
798

 
294

 
—

 
1,092

Net derivative instruments settlements
(1
)
 
(10
)
 
(347
)
 
—

 
(358
)
Advances from affiliates
36

 
—

 
—

 
(36
)
 
—

Acquisition of subsidiaries (net of cash acquired of $8)
—

 
(98
)
 
—

 
—

 
(98
)
Capital contribution
—

 
—

 
(90
)
 
90

 
—

Other
—

 
(279
)
 
(60
)
 
—

 
(339
)
Net cash flows from (used for) investing activities
35

 
(1,463
)
 
(1,308
)
 
54

 
(2,682
)
Cash flows from financing activities
 
 
 
 
 
 
 
 
 
Dividends paid on Common Shares
(484
)
 
—

 
—

 
—

 
(484
)
Common Shares repurchased
—

 
—

 
(11
)
 
—

 
(11
)
Net proceeds from issuance of short-term debt
—

 
1

 
150

 
—

 
151

Proceeds from share-based compensation plans
17

 
—

 
56

 
—

 
73

Advances to affiliates
—

 
(10
)
 
(26
)
 
36

 
—

Capital contribution
—

 
90

 
—

 
(90
)
 
—

Net cash flows from (used for) financing activities
(467
)
 
81

 
169

 
(54
)
 
(271
)
Effect of foreign currency rate changes on cash and cash equivalents
—

 
(3
)
 
7

 
—

 
4

Net increase (decrease) in cash
(222
)
 
168

 
130

 
—

 
76

Cash – beginning of period
106

 
382

 
126

 
—

 
614

Cash – end of period(3)
$
(116
)
 
$
550

 
$
256

 
$
—

 
$
690

(1)
Includes all other subsidiaries of ACE Limited and intercompany eliminations.
(2)
Includes ACE Limited parent company eliminations and certain consolidating adjustments.
(3)
ACE maintains two notional multicurrency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At September 30, 2012 and December 31, 2011, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.
Acquisitions (Detail) (USD $)
In Millions, unless otherwise specified
1 Months Ended 1 Months Ended 1 Months Ended
Apr. 30, 2013
Fianzas Monterrey [Member]
Apr. 2, 2013
Fianzas Monterrey [Member]
May 31, 2013
ABA Seguros [Member]
May 2, 2013
ABA Seguros [Member]
Jan. 31, 2013
PT Asuransi Jaya Proteksi (JaPro) [Member]
Jan. 3, 2013
PT Asuransi Jaya Proteksi (JaPro) [Member]
Sep. 18, 2012
PT Asuransi Jaya Proteksi (JaPro) [Member]
Business Acquisition [Line Items]
 
 
 
 
 
 
 
Acquisition purchase price
$ 293 
 
$ 690 
 
$ 107 
 
 
Business Acquisition, Percentage of Voting Interests Acquired
 
 
 
 
 
20.00% 
80.00% 
Business Acquisition, Purchase Price Allocation, Goodwill Amount
 
135 
 
283 
 
 
 
Business Acquisition, Purchase Price Allocation, Intangible Assets Other than Goodwill
 
$ 73 
 
$ 140 
 
 
 
Investments (Narrative) (Detail) (USD $)
3 Months Ended 9 Months Ended
Sep. 30, 2013
Security
Sep. 30, 2012
Sep. 30, 2013
Security
Sep. 30, 2012
Dec. 31, 2012
Investments, Debt and Equity Securities [Abstract]
 
 
 
 
 
Net unrealized appreciation (depreciation) included in OCI
$ (1,000,000)
$ 46,000,000 
$ 24,000,000 
$ 130,000,000 
 
Net unrealized depreciation included in AOCI
4,000,000 
 
4,000,000 
 
25,000,000 
Percentage of mortgage-backed securities represented by investments in US government agency bonds
84.00% 
 
84.00% 
 
85.00% 
Credit losses recognized in net income for corporate securities
1,000,000 
5,000,000 
8,000,000 
9,000,000 
 
Credit losses recognized in net income for mortgage-backed securities
0 
2,000,000 
0 
5,000,000 
 
Number of fixed maturities in an unrealized loss position
6,038 
 
6,038 
 
 
Total number of fixed maturities
24,746 
 
24,746 
 
 
Largest single unrealized loss in the fixed maturities
3,000,000 
 
3,000,000 
 
 
Number of equity securities in an unrealized loss position
66 
 
66 
 
 
Total number of equity securities
183 
 
183 
 
 
Largest single unrealized loss in the equity securities
48,000,000 
 
48,000,000 
 
 
Restricted assets in fixed maturities and short-term investments
16,300,000,000 
 
16,300,000,000 
 
16,600,000,000 
Restricted assets in cash
$ 129,000,000 
 
$ 129,000,000 
 
$ 139,000,000 
Investments (Schedule Of Fixed Maturities By Contractual Maturity) (Detail) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2013
Dec. 31, 2012
Investments, Debt and Equity Securities [Abstract]
 
 
Available for sale, Due in 1 year or less, Amortized Cost
$ 2,317 
$ 1,887 
Available for sale, Due after 1 year through 5 years, Amortized Cost
13,978 
13,411 
Available for sale, Due after 5 years though 10 years, Amortized Cost
16,291 
15,032 
Available for sale, Due after 10 years, Amortized Cost
4,601 
4,285 
Available for sale, Subtotal, Amortized Cost
37,187 
34,615 
Available for sale, Mortgage-backed securities, Amortized Cost
10,294 
10,051 
Available for sale, Amortized Cost
47,481 
44,666 
Available for sale, Fair Value
48,529 
47,306 
Held to maturity, Due in 1 year or less, Amortized Cost
398 
656 
Held to maturity, Due after 1 year through 5 years, Amortized Cost
2,335 
1,870 
Held to maturity, Due after 5 years through 10 years, Amortized Cost
1,707 
2,119 
Held to maturity, Due after 10 years, Amortized Cost
426 
597 
Held to maturity, Subtotal, Amortized Cost
4,866 
5,242 
Held to maturity, Mortgage backed securities, Amortized Cost
1,440 
2,028 
Available for sale, Due in 1 year or less, Fair Value
2,345 
1,906 
Available for sale, Due after 1 year through 5 years, Fair Value
14,450 
14,010 
Available for sale, Due after 5 years through 10 years, Fair Value
16,650 
16,153 
Available for sale, Due after 10 years, Fair Value
4,705 
4,764 
Available for sale, Subtotal, Fair Value
38,150 
36,833 
Available for sale, Mortgage backed securities, Fair Value
10,379 
10,473 
Held to maturity, Due in 1 year or less, Fair Value
401 
659 
Held to maturity, Due after 1 year through 5, Fair Value
2,417 
1,950 
Held to maturity, Due after 5 years through 10 years, Fair Value
1,756 
2,267 
Held to maturity, Due after 10 years, Fair Value
436 
641 
Held to maturity, Subtotal, Fair Value
5,010 
5,517 
Held to maturity, Mortgage backed securities, Fair Value
1,483 
2,116 
Held-to-maturity Securities
6,306 
7,270 
Held to maturity, Fair Value
$ 6,493 
$ 7,633 
Investments (Schedule Of Cost And Fair Value Of Equity Securities) (Detail) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2013
Dec. 31, 2012
Investments, Debt and Equity Securities [Abstract]
 
 
Document Fiscal Year Focus
2013 
 
Cost
$ 835 
$ 707 
Gross unrealized appreciation
53 
41 
Gross unrealized depreciation
(57)
(4)
Fair value
$ 831 
$ 744 
Investments (Net Realized Gains (Losses) And Losses Included In Net Realized Gains (Losses) And Other Comprehensive Income) (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Investments, Debt and Equity Securities [Abstract]
 
 
 
 
Document Fiscal Year Focus
 
 
2013 
 
OTTI on fixed maturities, gross
$ (4)
$ (10)
$ (11)
$ (18)
OTTI on fixed maturities recognized in OCI (pre-tax)
0 
0 
0 
0 
OTTI on fixed maturities, net
(4)
(10)
(11)
(18)
Fixed maturities, Gross realized gains excluding OTTI
37 
71 
163 
287 
Fixed maturities, Gross realized losses excluding OTTI
(16)
(14)
(68)
(120)
Total fixed maturities
17 
47 
84 
149 
OTTI on equity securities
0 
0 
(1)
(5)
Equity securities, Gross realized gains excluding OTTI
8 
3 
18 
5 
Equity securities, Gross realized losses excluding OTTI
(1)
(1)
(4)
(2)
Total equity securities
7 
2 
13 
(2)
OTTI on other investments
0 
0 
(2)
(7)
Foreign exchange gains (losses)
(26)
(50)
45 
(64)
Investment and embedded derivative instruments
4 
4 
62 
(3)
Fair value adjustments on insurance derivative
134 
83 
563 
44 
S&P put options and futures
(95)
(147)
(413)
(308)
Other derivative instruments
(1)
0 
(2)
(4)
Other
0 
1 
0 
1 
Total net realized gains (losses)
$ 40 
$ (60)
$ 350 
$ (194)
Investments (Aggregate Fair Value And Gross Unrealized Loss By Length Of Time Security Has Continuously Been In Unrealized Loss Position) (Detail) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2013
Dec. 31, 2012
Investment [Line Items]
 
 
Investment securities, Unrealized loss position, 0-12 Months, Fair Value
$ 16,533 
$ 3,968 
Investment securities, Unrealized loss position, 0-12 Months, Gross Unrealized Loss
(556)
(48)
Investment securities, Unrealized loss position, Over 12 Months, Fair Value
314 
577 
Investment securities, Unrealized loss position, Over 12 Months, Gross Unrealized Loss
(25)
(50)
Investment securities, Unrealized loss position, Total Fair Value
16,847 
4,545 
Investment securities, Unrealized loss position, Total Gross Unrealized Loss
(581)
(98)
US Treasury and Government [Member]
 
 
Investment [Line Items]
 
 
Investment securities, Unrealized loss position, 0-12 Months, Fair Value
1,436 
440 
Investment securities, Unrealized loss position, 0-12 Months, Gross Unrealized Loss
(39)
(1)
Investment securities, Unrealized loss position, Over 12 Months, Fair Value
0 
0 
Investment securities, Unrealized loss position, Over 12 Months, Gross Unrealized Loss
0 
0 
Investment securities, Unrealized loss position, Total Fair Value
1,436 
440 
Investment securities, Unrealized loss position, Total Gross Unrealized Loss
(39)
(1)
Foreign Government Debt Securities [Member]
 
 
Investment [Line Items]
 
 
Investment securities, Unrealized loss position, 0-12 Months, Fair Value
4,034 
1,234 
Investment securities, Unrealized loss position, 0-12 Months, Gross Unrealized Loss
(93)
(8)
Investment securities, Unrealized loss position, Over 12 Months, Fair Value
112 
88 
Investment securities, Unrealized loss position, Over 12 Months, Gross Unrealized Loss
(5)
(6)
Investment securities, Unrealized loss position, Total Fair Value
4,146 
1,322 
Investment securities, Unrealized loss position, Total Gross Unrealized Loss
(98)
(14)
Corporate Securities [Member]
 
 
Investment [Line Items]
 
 
Investment securities, Unrealized loss position, 0-12 Months, Fair Value
4,696 
1,026 
Investment securities, Unrealized loss position, 0-12 Months, Gross Unrealized Loss
(142)
(23)
Investment securities, Unrealized loss position, Over 12 Months, Fair Value
67 
85 
Investment securities, Unrealized loss position, Over 12 Months, Gross Unrealized Loss
(9)
(8)
Investment securities, Unrealized loss position, Total Fair Value
4,763 
1,111 
Investment securities, Unrealized loss position, Total Gross Unrealized Loss
(151)
(31)
Collateralized Mortgage Backed Securities [Member]
 
 
Investment [Line Items]
 
 
Investment securities, Unrealized loss position, 0-12 Months, Fair Value
3,751 
855 
Investment securities, Unrealized loss position, 0-12 Months, Gross Unrealized Loss
(139)
(4)
Investment securities, Unrealized loss position, Over 12 Months, Fair Value
132 
356 
Investment securities, Unrealized loss position, Over 12 Months, Gross Unrealized Loss
(10)
(32)
Investment securities, Unrealized loss position, Total Fair Value
3,883 
1,211 
Investment securities, Unrealized loss position, Total Gross Unrealized Loss
(149)
(36)
US States and Political Subdivisions Debt Securities [Member]
 
 
Investment [Line Items]
 
 
Investment securities, Unrealized loss position, 0-12 Months, Fair Value
2,076 
316 
Investment securities, Unrealized loss position, 0-12 Months, Gross Unrealized Loss
(77)
(3)
Investment securities, Unrealized loss position, Over 12 Months, Fair Value
3 
48 
Investment securities, Unrealized loss position, Over 12 Months, Gross Unrealized Loss
(1)
(4)
Investment securities, Unrealized loss position, Total Fair Value
2,079 
364 
Investment securities, Unrealized loss position, Total Gross Unrealized Loss
(78)
(7)
Fixed Maturities [Member]
 
 
Investment [Line Items]
 
 
Investment securities, Unrealized loss position, 0-12 Months, Fair Value
15,993 
3,871 
Investment securities, Unrealized loss position, 0-12 Months, Gross Unrealized Loss
(490)
(39)
Investment securities, Unrealized loss position, Over 12 Months, Fair Value
314 
577 
Investment securities, Unrealized loss position, Over 12 Months, Gross Unrealized Loss
(25)
(50)
Investment securities, Unrealized loss position, Total Fair Value
16,307 
4,448 
Investment securities, Unrealized loss position, Total Gross Unrealized Loss
(515)
(89)
Equity Securities [Member]
 
 
Investment [Line Items]
 
 
Investment securities, Unrealized loss position, 0-12 Months, Fair Value
500 
29 
Investment securities, Unrealized loss position, 0-12 Months, Gross Unrealized Loss
(57)
(4)
Investment securities, Unrealized loss position, Over 12 Months, Fair Value
0 
0 
Investment securities, Unrealized loss position, Over 12 Months, Gross Unrealized Loss
0 
0 
Investment securities, Unrealized loss position, Total Fair Value
500 
29 
Investment securities, Unrealized loss position, Total Gross Unrealized Loss
(57)
(4)
Other Long-term Investments [Member]
 
 
Investment [Line Items]
 
 
Investment securities, Unrealized loss position, 0-12 Months, Fair Value
40 
68 
Investment securities, Unrealized loss position, 0-12 Months, Gross Unrealized Loss
(9)
(5)
Investment securities, Unrealized loss position, Over 12 Months, Fair Value
0 
0 
Investment securities, Unrealized loss position, Over 12 Months, Gross Unrealized Loss
0 
0 
Investment securities, Unrealized loss position, Total Fair Value
40 
68 
Investment securities, Unrealized loss position, Total Gross Unrealized Loss
$ (9)
$ (5)
Investments (Schedule Of Components Of Restricted Assets) (Detail) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2013
Dec. 31, 2012
Investments, Debt and Equity Securities [Abstract]
 
 
Document Fiscal Year Focus
2013 
 
Trust funds
$ 11,269 
$ 11,389 
Deposits with non-U.S. regulatory authorities
1,999 
2,133 
Assets pledged under repurchase agreements
1,405 
1,401 
Deposits with U.S. regulatory authorities
1,333 
1,338 
Other pledged assets
394 
456 
Total restricted assets
$ 16,400 
$ 16,717 
Fair Value Measurements (Narrative) (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Year
Sep. 30, 2012
Sep. 30, 2013
Year
Sep. 30, 2012
Fair Value Measurements Of Financial Instruments [Line Items]
 
 
 
 
GLB - Lapse rate - lower range
1.00% 
 
1.00% 
 
GLB - Lapse rate - upper range
6.00% 
 
6.00% 
 
GLB - Spike lapse rate - lower range
10.00% 
 
10.00% 
 
GLB - Spike lapse rate - upper range
30.00% 
 
30.00% 
 
GLB - Ultimate lapse rate
10.00% 
 
10.00% 
 
GLB - Length of ultimate lapse rate period, years
2 
 
2 
 
GLB - Adjustment factor for valuable guarantees - lower
15.00% 
 
15.00% 
 
GLB - Adjustment factor for valuable guarantees - upper
75.00% 
 
75.00% 
 
Percent of GMIB guaranteed value that are represented by clients with several years of annuitization experience
37.00% 
 
37.00% 
 
GLB - Maximum annuitization rate
8.00% 
 
8.00% 
 
GLB - First year maximum annuitization rate
13.00% 
 
13.00% 
 
GLB - Weighted average maximum annuitization rate - rate 1
8.00% 
 
8.00% 
 
GLB - Weighted average maximum annuitization rate - rate 2
12.00% 
 
12.00% 
 
GLB - Weighted average maximum annuitization rate - rate 3
30.00% 
 
30.00% 
 
Level 1 to Level 2 Transfers
$ 0 
$ 34 
$ 19 
$ 40 
Level 2 to Level 1 Transfers
$ 0 
$ 15 
$ 0 
$ 15 
Guaranteed Living Benefits Number Of Annuitization Functions
3 
 
3 
 
Redemption Notice Periods Lower Range [Member]
 
 
 
 
Fair Value Measurements Of Financial Instruments [Line Items]
 
 
 
 
Notice period for redemption for alternative investments investment funds, days
 
 
5 days 
 
Redemption Notice Periods Upper Range [Member]
 
 
 
 
Fair Value Measurements Of Financial Instruments [Line Items]
 
 
 
 
Notice period for redemption for alternative investments investment funds, days
 
 
120 days 
 
Fair Value Measurements (Financial Instruments Measured At Fair Value On Recurring Basis) (Detail) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2013
Dec. 31, 2012
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
$ 48,529 
$ 47,306 
Equity securities, at fair value
831 
744 
Short-term investments
1,774 
2,228 
Other investments
2,902 
2,716 
Securities lending collateral
1,517 
1,791 
Fair Value, Inputs, Level 1 [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
1,851 
2,292 
Equity securities, at fair value
375 
253 
Short-term investments
1,061 
1,503 
Other investments
292 
268 
Investment derivative instruments
(18)
11 
Other derivative instruments
7 
(6)
Separate account assets
1,074 
872 
Total assets measured at fair value
4,642 
5,193 
Fair Value, Inputs, Level 1 [Member] |
U.S. Treasury And Agency [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
1,615 
2,050 
Fair Value, Inputs, Level 1 [Member] |
Foreign [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
235 
222 
Fair Value, Inputs, Level 1 [Member] |
Corporate Securities [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
1 
20 
Fair Value, Inputs, Level 2 [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
46,506 
44,839 
Equity securities, at fair value
452 
488 
Short-term investments
705 
725 
Other investments
221 
196 
Securities lending collateral
1,517 
1,791 
Other derivative instruments
8 
30 
Separate account assets
78 
71 
Total assets measured at fair value
49,487 
48,140 
Fair Value, Inputs, Level 2 [Member] |
U.S. Treasury And Agency [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
1,364 
1,685 
Fair Value, Inputs, Level 2 [Member] |
Foreign [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
14,324 
13,431 
Fair Value, Inputs, Level 2 [Member] |
Corporate Securities [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
17,144 
16,586 
Fair Value, Inputs, Level 2 [Member] |
Mortgage Backed-Securities [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
10,370 
10,460 
Fair Value, Inputs, Level 2 [Member] |
States, Municipalities, And Political Subdivisions [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
3,304 
2,677 
Fair Value, Inputs, Level 3 [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
172 
175 
Equity securities, at fair value
4 
3 
Short-term investments
8 
 
Other investments
2,389 
2,252 
Other derivative instruments
0 
0 
Total assets measured at fair value
2,573 
2,430 
GLB
514 1
1,119 1
Fair Value, Inputs, Level 3 [Member] |
U.S. Treasury And Agency [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
0 
0 
Fair Value, Inputs, Level 3 [Member] |
Foreign [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
42 
60 
Fair Value, Inputs, Level 3 [Member] |
Corporate Securities [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
121 
102 
Fair Value, Inputs, Level 3 [Member] |
Mortgage Backed-Securities [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
9 
13 
Fair Value, Inputs, Level 3 [Member] |
States, Municipalities, And Political Subdivisions [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
0 
0 
Estimate of Fair Value, Fair Value Disclosure [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
48,529 
47,306 
Equity securities, at fair value
831 
744 
Short-term investments
1,774 
2,228 
Other investments
2,902 
2,716 
Securities lending collateral
1,517 
1,791 
Investment derivative instruments
(18)
11 
Other derivative instruments
15 
24 
Separate account assets
1,152 
943 
Total assets measured at fair value
56,702 
55,763 
GLB
514 1
1,119 1
Estimate of Fair Value, Fair Value Disclosure [Member] |
U.S. Treasury And Agency [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
2,979 
3,735 
Estimate of Fair Value, Fair Value Disclosure [Member] |
Foreign [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
14,601 
13,713 
Estimate of Fair Value, Fair Value Disclosure [Member] |
Corporate Securities [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
17,266 
16,708 
Estimate of Fair Value, Fair Value Disclosure [Member] |
Mortgage Backed-Securities [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
10,379 
10,473 
Estimate of Fair Value, Fair Value Disclosure [Member] |
States, Municipalities, And Political Subdivisions [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
 
 
Fixed maturities available for sale at fair value
$ 3,304 
$ 2,677 
Fair Value Measurements (Schedule Of Significant Unobservable Inputs Used In Level 3 Liability Valuations) (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Jun. 30, 2013
Dec. 31, 2012
Jun. 30, 2012
Dec. 31, 2011
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
 
 
 
 
 
 
 
 
Valuation Technique
 
 
Actuarial model 1
 
 
 
 
 
Minimum [Member]
 
 
 
 
 
 
 
 
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
 
 
 
 
 
 
 
 
Significant Unobservable Inputs Lapse rate
1.00% 1
 
1.00% 1
 
 
 
 
 
Significant Unobservable Inputs Annuitization rate
 
 
0.00% 1
 
 
 
 
 
Maximum [Member]
 
 
 
 
 
 
 
 
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
 
 
 
 
 
 
 
 
Significant Unobservable Inputs Lapse rate
30.00% 1
 
30.00% 1
 
 
 
 
 
Significant Unobservable Inputs Annuitization rate
 
 
50.00% 1
 
 
 
 
 
Guaranteed Minimum Income Benefit [Member]
 
 
 
 
 
 
 
 
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
 
 
 
 
 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliations, Recurring Basis, Liability Value
$ 514 2
$ 1,279 2
$ 514 2
$ 1,279 2
$ 652 2
$ 1,119 2
$ 1,354 2
$ 1,319 2
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Gain (Loss) Included in Earnings
(138)2
(75)2
(605)2
(40)2
 
 
 
 
Fair Value
514 1
 
514 1
 
 
1,119 
 
 
Short-term Investments [Member]
 
 
 
 
 
 
 
 
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
 
 
 
 
 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value
8 
 
8 
 
9 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Purchases
$ 0 
 
$ 2 
 
 
 
 
 
Fair Value Measurements (Financial Instruments Measured At Fair Value Using Significant Unobservable Inputs) (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Jun. 30, 2013
Dec. 31, 2012
Jun. 30, 2012
Dec. 31, 2011
Equity Securities [Member]
 
 
 
 
 
 
 
 
Schedule Of Fair Value Measurements [Line Items]
 
 
 
 
 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3
$ 0 
$ 2 
$ 7 
$ 2 
 
 
 
 
Balance- Beginning of Period, Assets
4 
12 
3 
13 
 
 
 
 
Transfers out of Level 3, Assets
0 
(10)
(1)
(10)
 
 
 
 
Change in Net Unrealized Gains (Losses) included in OCI, Assets
0 
(1)
(5)
0 
 
 
 
 
Net Realized Gains/Losses, Assets
 
0 
4 
0 
 
 
 
 
Purchases, Assets
0 
1 
1 
4 
 
 
 
 
Sales, Assets
0 
0 
(5)
(5)
 
 
 
 
Settlements, Assets
 
0 
 
0 
 
 
 
 
Balance-End of Period, Assets
4 
4 
4 
4 
 
 
 
 
Net Realized Gains/Losses Attributable to Changes in Fair Value at the Balance Sheet Date, Assets
 
0 
 
0 
 
 
 
 
Short-term Investments [Member]
 
 
 
 
 
 
 
 
Schedule Of Fair Value Measurements [Line Items]
 
 
 
 
 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3
1 
 
8 
 
 
 
 
 
Balance- Beginning of Period, Assets
9 
 
 
 
 
 
 
 
Transfers out of Level 3, Assets
(2)
 
(2)
 
 
 
 
 
Purchases, Assets
0 
 
2 
 
 
 
 
 
Balance-End of Period, Assets
8 
 
8 
 
 
 
 
 
Other Long-term Investments [Member]
 
 
 
 
 
 
 
 
Schedule Of Fair Value Measurements [Line Items]
 
 
 
 
 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3
0 
53 
0 
53 
 
 
 
 
Balance- Beginning of Period, Assets
2,349 
2,047 
2,252 
1,877 
 
 
 
 
Transfers out of Level 3, Assets
 
0 
 
0 
 
 
 
 
Change in Net Unrealized Gains (Losses) included in OCI, Assets
(1)
13 
34 
37 
 
 
 
 
Net Realized Gains/Losses, Assets
0 
0 
(2)
(7)
 
 
 
 
Purchases, Assets
138 
121 
387 
366 
 
 
 
 
Sales, Assets
(1)
(5)
(10)
(6)
 
 
 
 
Settlements, Assets
(96)
(51)
(272)
(142)
 
 
 
 
Balance-End of Period, Assets
2,389 
2,178 
2,389 
2,178 
 
 
 
 
Net Realized Gains/Losses Attributable to Changes in Fair Value at the Balance Sheet Date, Assets
0 
0 
(2)
(7)
 
 
 
 
Other Derivative Instruments [Member]
 
 
 
 
 
 
 
 
Schedule Of Fair Value Measurements [Line Items]
 
 
 
 
 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3
 
0 
 
0 
 
 
 
 
Balance- Beginning of Period, Assets
 
1 
 
3 
 
 
 
 
Transfers out of Level 3, Assets
 
0 
 
0 
 
 
 
 
Change in Net Unrealized Gains (Losses) included in OCI, Assets
 
0 
 
0 
 
 
 
 
Net Realized Gains/Losses, Assets
 
0 
 
(4)
 
 
 
 
Purchases, Assets
 
0 
 
3 
 
 
 
 
Sales, Assets
 
0 
 
0 
 
 
 
 
Settlements, Assets
 
(1)
 
(2)
 
 
 
 
Balance-End of Period, Assets
 
0 
 
0 
 
 
 
 
Net Realized Gains/Losses Attributable to Changes in Fair Value at the Balance Sheet Date, Assets
 
0 
 
0 
 
 
 
 
Available-for-sale Securities [Member] |
US Treasury and Government [Member]
 
 
 
 
 
 
 
 
Schedule Of Fair Value Measurements [Line Items]
 
 
 
 
 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3
 
0 
 
0 
 
 
 
 
Balance- Beginning of Period, Assets
 
4 
 
5 
 
 
 
 
Transfers out of Level 3, Assets
 
(4)
 
(4)
 
 
 
 
Change in Net Unrealized Gains (Losses) included in OCI, Assets
 
0 
 
0 
 
 
 
 
Net Realized Gains/Losses, Assets
 
0 
 
0 
 
 
 
 
Purchases, Assets
 
0 
 
0 
 
 
 
 
Sales, Assets
 
0 
 
0 
 
 
 
 
Settlements, Assets
 
0 
 
(1)
 
 
 
 
Balance-End of Period, Assets
 
0 
 
0 
 
 
 
 
Available-for-sale Securities [Member] |
Foreign [Member]
 
 
 
 
 
 
 
 
Schedule Of Fair Value Measurements [Line Items]
 
 
 
 
 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3
1 
5 
33 
6 
 
 
 
 
Balance- Beginning of Period, Assets
48 
20 
60 
33 
 
 
 
 
Transfers out of Level 3, Assets
(8)
(6)
(49)
(7)
 
 
 
 
Change in Net Unrealized Gains (Losses) included in OCI, Assets
2 
0 
(2)
0 
 
 
 
 
Net Realized Gains/Losses, Assets
0 
0 
1 
0 
 
 
 
 
Purchases, Assets
12 
6 
15 
46 
 
 
 
 
Sales, Assets
(13)
0 
(15)
(52)
 
 
 
 
Settlements, Assets
0 
0 
(1)
(1)
 
 
 
 
Balance-End of Period, Assets
42 
25 
42 
25 
 
 
 
 
Available-for-sale Securities [Member] |
Corporate Debt Securities [Member]
 
 
 
 
 
 
 
 
Schedule Of Fair Value Measurements [Line Items]
 
 
 
 
 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3
12 
5 
29 
33 
 
 
 
 
Balance- Beginning of Period, Assets
114 
137 
102 
134 
 
 
 
 
Transfers out of Level 3, Assets
(1)
(26)
(30)
(35)
 
 
 
 
Change in Net Unrealized Gains (Losses) included in OCI, Assets
(1)
3 
(1)
6 
 
 
 
 
Net Realized Gains/Losses, Assets
(1)
0 
(2)
(1)
 
 
 
 
Purchases, Assets
6 
11 
39 
19 
 
 
 
 
Sales, Assets
(4)
0 
(4)
(15)
 
 
 
 
Settlements, Assets
(4)
0 
(12)
(11)
 
 
 
 
Balance-End of Period, Assets
121 
130 
121 
130 
 
 
 
 
Available-for-sale Securities [Member] |
Mortgage Backed-Securities [Member]
 
 
 
 
 
 
 
 
Schedule Of Fair Value Measurements [Line Items]
 
 
 
 
 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3
0 
10 
0 
22 
 
 
 
 
Balance- Beginning of Period, Assets
9 
27 
13 
28 
 
 
 
 
Transfers out of Level 3, Assets
0 
0 
0 
(15)
 
 
 
 
Change in Net Unrealized Gains (Losses) included in OCI, Assets
 
0 
 
0 
 
 
 
 
Net Realized Gains/Losses, Assets
 
0 
 
0 
 
 
 
 
Purchases, Assets
0 
0 
0 
4 
 
 
 
 
Sales, Assets
0 
(7)
(3)
(7)
 
 
 
 
Settlements, Assets
0 
(1)
(1)
(3)
 
 
 
 
Balance-End of Period, Assets
9 
29 
9 
29 
 
 
 
 
Available-for-sale Securities [Member] |
States, Municipalities, And Political Subdivisions [Member]
 
 
 
 
 
 
 
 
Schedule Of Fair Value Measurements [Line Items]
 
 
 
 
 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3
 
0 
 
1 
 
 
 
 
Balance- Beginning of Period, Assets
 
1 
 
1 
 
 
 
 
Transfers out of Level 3, Assets
 
0 
 
0 
 
 
 
 
Change in Net Unrealized Gains (Losses) included in OCI, Assets
 
0 
 
0 
 
 
 
 
Net Realized Gains/Losses, Assets
 
0 
 
0 
 
 
 
 
Purchases, Assets
 
0 
 
0 
 
 
 
 
Sales, Assets
 
0 
 
0 
 
 
 
 
Settlements, Assets
 
0 
 
(1)
 
 
 
 
Balance-End of Period, Assets
 
1 
 
1 
 
 
 
 
Guaranteed Minimum Income Benefit [Member]
 
 
 
 
 
 
 
 
Schedule Of Fair Value Measurements [Line Items]
 
 
 
 
 
 
 
 
Fair Value, Measurement with Unobservable Inputs Reconciliations, Recurring Basis, Liability Value
514 1
1,279 1
514 1
1,279 1
652 1
1,119 1
1,354 1
1,319 1
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Gain (Loss) Included in Earnings
(138)1
(75)1
(605)1
(40)1
 
 
 
 
Net Realized Gains/Losses Attributable to Changes in Fair Value at the Balance Sheet Date, Liabilities
(138)
(75)
(605)
(40)
 
 
 
 
Reported liabilities
$ 746 
$ 1,500 
$ 746 
$ 1,500 
 
$ 1,400 
$ 1,600 
$ 1,500 
Fair Value Measurements (Carrying Values And Fair Values Of Financial Instruments Not Measured At Fair Value) (Detail) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2013
Dec. 31, 2012
Financial Instruments Fair Value [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
$ 6,493 
$ 7,633 
Partially-owned insurance companies
468 
454 
Total assets
6,961 
8,087 
Short-term debt
1,920 
1,401 
Long-term debt
4,146 
3,916 
Trust preferred securities
441 
446 
Total liabilities
6,507 
5,763 
Financial Instruments Fair Value [Member] |
US Treasury and Government [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
859 
1,083 
Financial Instruments Fair Value [Member] |
Foreign [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
912 
964 
Financial Instruments Fair Value [Member] |
Corporate Debt Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
2,047 
2,275 
Financial Instruments Fair Value [Member] |
Collateralized Mortgage Backed Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
1,483 
2,116 
Financial Instruments Fair Value [Member] |
US States and Political Subdivisions Debt Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
1,192 
1,195 
Fair Value, Inputs, Level 1 [Member] |
Financial Instruments Fair Value [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
615 
619 
Total assets
615 
619 
Fair Value, Inputs, Level 1 [Member] |
Financial Instruments Fair Value [Member] |
US Treasury and Government [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
615 
619 
Fair Value, Inputs, Level 2 [Member] |
Financial Instruments Fair Value [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
5,862 
6,996 
Total assets
5,862 
6,996 
Short-term debt
1,920 
1,401 
Long-term debt
4,146 
3,916 
Trust preferred securities
441 
446 
Total liabilities
6,507 
5,763 
Fair Value, Inputs, Level 2 [Member] |
Financial Instruments Fair Value [Member] |
US Treasury and Government [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
244 
464 
Fair Value, Inputs, Level 2 [Member] |
Financial Instruments Fair Value [Member] |
Foreign [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
912 
964 
Fair Value, Inputs, Level 2 [Member] |
Financial Instruments Fair Value [Member] |
Corporate Debt Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
2,031 
2,257 
Fair Value, Inputs, Level 2 [Member] |
Financial Instruments Fair Value [Member] |
Collateralized Mortgage Backed Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
1,483 
2,116 
Fair Value, Inputs, Level 2 [Member] |
Financial Instruments Fair Value [Member] |
US States and Political Subdivisions Debt Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
1,192 
1,195 
Fair Value, Inputs, Level 3 [Member] |
Financial Instruments Fair Value [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
16 
18 
Partially-owned insurance companies
468 
454 
Total assets
484 
472 
Fair Value, Inputs, Level 3 [Member] |
Financial Instruments Fair Value [Member] |
US Treasury and Government [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
0 
0 
Fair Value, Inputs, Level 3 [Member] |
Financial Instruments Fair Value [Member] |
Corporate Debt Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
16 
18 
Carrying (Reported) Amount, Fair Value Disclosure [Member] |
Financial Instruments Carrying Value [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
6,306 
7,270 
Partially-owned insurance companies
468 
454 
Total assets
6,774 
7,724 
Short-term debt
1,902 
1,401 
Long-term debt
3,807 
3,360 
Trust preferred securities
309 
309 
Total liabilities
6,018 
5,070 
Carrying (Reported) Amount, Fair Value Disclosure [Member] |
Financial Instruments Carrying Value [Member] |
US Treasury and Government [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
842 
1,044 
Carrying (Reported) Amount, Fair Value Disclosure [Member] |
Financial Instruments Carrying Value [Member] |
Foreign [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
876 
910 
Carrying (Reported) Amount, Fair Value Disclosure [Member] |
Financial Instruments Carrying Value [Member] |
Corporate Debt Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
1,960 
2,133 
Carrying (Reported) Amount, Fair Value Disclosure [Member] |
Financial Instruments Carrying Value [Member] |
Collateralized Mortgage Backed Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
1,440 
2,028 
Carrying (Reported) Amount, Fair Value Disclosure [Member] |
Financial Instruments Carrying Value [Member] |
US States and Political Subdivisions Debt Securities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Total Fixed maturities held to maturity
$ 1,188 
$ 1,155 
Assumed Life Reinsurance Programs Involving Minimum Benefit Guarantees Under Annuity Contracts (Schedule Of Guaranteed Minimum Benefits Income And Expense) (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Guaranteed Minimum Benefits [Line Items]
 
 
 
 
Net premiums earned
$ 4,610 
$ 4,665 
$ 12,250 
$ 11,829 
Policy benefits and other reserve adjustments
138 
130 
379 
379 
Net realized gains (losses)
40 
(60)
350 
(194)
Guaranteed Minimum Death Benefit [Member]
 
 
 
 
Guaranteed Minimum Benefits [Line Items]
 
 
 
 
Net premiums earned
19 
20 
59 
64 
Policy benefits and other reserve adjustments
14 
22 
58 
61 
Guaranteed Minimum Income Benefit [Member]
 
 
 
 
Guaranteed Minimum Benefits [Line Items]
 
 
 
 
Net premiums earned
36 
40 
112 
121 
Policy benefits and other reserve adjustments
9 
7 
20 
30 
Net realized gains (losses)
138 
75 
608 
41 
Gain recognized in income
165 
108 
700 
132 
Net cash received
31 
35 
94 
114 
Net decrease in liability
$ 134 
$ 73 
$ 606 
$ 18 
Assumed Life Reinsurance Programs Involving Minimum Benefit Guarantees Under Annuity Contracts (Narrative) (Detail) (USD $)
9 Months Ended
Sep. 30, 2013
Sep. 30, 2013
Guaranteed Minimum Death Benefit [Member]
Dec. 31, 2012
Guaranteed Minimum Death Benefit [Member]
Sep. 30, 2013
Guaranteed Minimum Income Benefit [Member]
Dec. 31, 2012
Guaranteed Minimum Income Benefit [Member]
Sep. 30, 2012
Guaranteed Minimum Income Benefit [Member]
Jun. 30, 2012
Guaranteed Minimum Income Benefit [Member]
Dec. 31, 2011
Guaranteed Minimum Income Benefit [Member]
Sep. 30, 2013
Guaranteed Minimum Deaths Benefits And Guaranteed Living Benefits [Member]
Dec. 31, 2012
Guaranteed Minimum Deaths Benefits And Guaranteed Living Benefits [Member]
Sep. 30, 2013
Guaranteed Living Benefits [Member]
Dec. 31, 2012
Guaranteed Living Benefits [Member]
Guaranteed Minimum Benefits [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Reported liabilities
 
$ 95,000,000 
$ 90,000,000 
$ 746,000,000 
$ 1,400,000,000 
$ 1,500,000,000 
$ 1,600,000,000 
$ 1,500,000,000 
 
 
 
 
Fair value derivative adjustment in liability
 
 
 
514,000,000 
1,100,000,000 
 
 
 
 
 
 
 
Net amount at risk
 
751,000,000 
1,300,000,000 
 
 
 
 
 
 
 
220,000,000 
445,000,000 
Mortality percentage according to Annuity 2000 mortality table
 
 
 
 
 
 
 
 
 
 
100.00% 
 
Discounting assumption used in the calculation of the benefit reserve averaging - lower range
 
1.50% 
 
 
 
 
 
 
2.50% 
 
3.50% 
 
Discounting assumption used in the calculation of the benefit reserve averaging - upper range
 
2.50% 
 
 
 
 
 
 
3.50% 
 
4.50% 
 
Total claim amount payable, if all of the Company's cedants' policyholders covered were to die immediately
 
618,000,000 
 
 
 
 
 
 
199,000,000 
 
 
 
GMBD net amount of risk
 
 
 
 
 
 
 
 
85,000,000 
116,000,000 
 
 
GLB net amount of risk
 
 
 
 
 
 
 
 
$ 241,000,000 
$ 655,000,000 
 
 
Average attained age of all policyholders under all benefits reinsured, years
68 years 
 
 
 
 
 
 
 
 
 
 
 
Debt (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2013
Senior Notes Due June 15, 2014 [Member]
Mar. 31, 2013
Senior Notes [Member]
ACE INA Senior Notes Due March 2023 [Member]
Mar. 31, 2013
Senior Notes [Member]
ACE INA Senior Notes Due March 2043 [Member]
Debt Instrument [Line Items]
 
 
 
Debt Instrument, Face Amount
 
$ 475 
$ 475 
Debt Instrument, Interest Rate, Stated Percentage
5.875% 
2.70% 
4.15% 
Make Whole Premium Additional Percent
 
0.10% 
0.15% 
Long-term Debt, Current Maturities
$ 500 
 
 
Commitments, Contingencies, And Guarantees (Balance Sheet Locations, Fair Values In Asset Or (Liability) Position, And Notional Values/Payment Provisions Of Derivative Instruments) (Detail) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2013
Sep. 30, 2013
Investment And Embedded Derivative Instruments [Member]
Dec. 31, 2012
Investment And Embedded Derivative Instruments [Member]
Sep. 30, 2013
Other Derivative Instruments [Member]
Dec. 31, 2012
Other Derivative Instruments [Member]
Sep. 30, 2013
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Foreign Exchange Future [Member]
Dec. 31, 2012
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Foreign Exchange Future [Member]
Sep. 30, 2013
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Cross Currency Swap [Member]
Dec. 31, 2012
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Cross Currency Swap [Member]
Sep. 30, 2013
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Futures Contracts On Money Market Instruments [Member]
Dec. 31, 2012
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Futures Contracts On Money Market Instruments [Member]
Sep. 30, 2013
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Futures contracts on notes and bonds [Member]
Dec. 31, 2012
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Futures contracts on notes and bonds [Member]
Sep. 30, 2013
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Single-Stock Future [Member]
Dec. 31, 2012
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Single-Stock Future [Member]
Sep. 30, 2013
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Options On Equity Market Indices [Member]
Dec. 31, 2012
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Options On Equity Market Indices [Member]
Sep. 30, 2013
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Other Derivatives [Member]
Dec. 31, 2012
Accounts Payable, Accrued Expenses, And Other Liabilities [Member]
Other Derivatives [Member]
Sep. 30, 2013
Fixed Maturities Available For Sale [Member]
Convertibles and Bonds with Warrants Attached [Member]
Dec. 31, 2012
Fixed Maturities Available For Sale [Member]
Convertibles and Bonds with Warrants Attached [Member]
Sep. 30, 2013
Accounts Payable Future Policy Benefits [Member]
Guaranteed Living Benefits [Member]
Dec. 31, 2012
Accounts Payable Future Policy Benefits [Member]
Guaranteed Living Benefits [Member]
Derivatives, Fair Value [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Document Fiscal Year Focus
2013 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fair Value
 
$ 298 
$ 320 
$ 15 
$ 24 
$ (7)
$ 0 
 
 
$ 2 
$ 1 
$ (13)
$ 10 
$ 7 1
$ (6)1
$ 10 1
$ 30 1
$ (2)
 
$ 291 
$ 309 
$ (746)2
$ (1,352)2
Notional Value/Payment Provision
 
$ 6,453 
$ 4,574 
$ 1,848 
$ 2,558 
$ 1,205 
$ 620 
$ 50 
$ 50 
$ 3,910 
$ 2,710 
$ 1,022 
$ 915 
$ 1,585 1
$ 2,308 1
$ 250 1
$ 250 1
$ 13 
$ 0 
$ 242 
$ 279 
$ 461 2
$ 1,100 2
Commitments, Contingencies, And Guarantees (Net Realized Gains (Losses) Of Derivative Instrument Activity In Consolidated Statement Of Operations) (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Dec. 31, 2012
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Document Fiscal Year Focus
 
 
2013 
 
 
Net realized gains (losses)
$ 42 
$ (60)
$ 210 
$ (271)
 
Foreign Exchange Future [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Net realized gains (losses)
(9)
(9)
8 
(8)
 
All Other Futures Contracts And Options [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Net realized gains (losses)
6 
0 
46 
(20)
 
Convertibles and Bonds with Warrants Attached [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Net realized gains (losses)
6 
12 
7 
24 
 
Dollar Rolls [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Net realized gains (losses)
1 
1 
1 
1 
 
Investment And Embedded Derivative Instruments [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Derivative Instruments Fair Value
298 
 
298 
 
320 
Derivative Instruments Notional Value Payment Provision
6,453 
 
6,453 
 
4,574 
Net realized gains (losses)
4 
4 
62 
(3)
 
Guaranteed Living Benefits [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Net realized gains (losses)
134 1
83 1
563 1
44 1
 
Single-Stock Future [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Net realized gains (losses)
(90)2
(138)2
(393)2
(286)2
 
Options On Equity Market Indices [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Net realized gains (losses)
(5)2
(9)2
(20)2
(22)2
 
Credit Default Swap [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Net realized gains (losses)
(1)
0 
(2)
(4)
 
Guaranteed Living Benefit And Other Derivative Instruments [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Net realized gains (losses)
38 
(64)
148 
(268)
 
Balance Sheet Location Fixed Maturities Available For Sale [Member] |
Convertibles and Bonds with Warrants Attached [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Derivative Instruments Fair Value
291 
 
291 
 
309 
Derivative Instruments Notional Value Payment Provision
242 
 
242 
 
279 
Balance Sheet Location Fixed Maturities Available For Sale [Member] |
Dollar Rolls [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Derivative Instruments Fair Value
25 
 
25 
 
0 
Derivative Instruments Notional Value Payment Provision
24 
 
24 
 
0 
Balance Sheet Location Accounts Payable [Member] |
Foreign Exchange Future [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Derivative Instruments Fair Value
(7)
 
(7)
 
0 
Derivative Instruments Notional Value Payment Provision
1,205 
 
1,205 
 
620 
Balance Sheet Location Accounts Payable [Member] |
Single-Stock Future [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Derivative Instruments Fair Value
7 2
 
7 2
 
(6)2
Derivative Instruments Notional Value Payment Provision
1,585 2
 
1,585 2
 
2,308 2
Balance Sheet Location Accounts Payable [Member] |
Options On Equity Market Indices [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Derivative Instruments Fair Value
10 2
 
10 2
 
30 2
Derivative Instruments Notional Value Payment Provision
250 2
 
250 2
 
250 2
Balance Sheet Location Accounts Payable [Member] |
Other Derivatives [Member]
 
 
 
 
 
Commitments Contingencies And Guarantees [Line Items]
 
 
 
 
 
Derivative Instruments Fair Value
(2)
 
(2)
 
 
Derivative Instruments Notional Value Payment Provision
$ 13 
 
$ 13 
 
$ 0 
Commitments, Contingencies, And Guarantees (Narrative) (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2013
Dec. 31, 2012
Commitments and Contingencies Disclosure [Abstract]
 
 
 
Carrying value of limited partnerships and partially-owned investment companies included in other investments
$ 1,825 
$ 1,825 
 
Funding commitments relating to limited partnerships and partially-owned investment companies
1,073 
1,073 
 
Derivative asset subject to a master netting agreement
(1)
(1)
35 
Repurchase obligations
1,402 
1,402 
1,401 
Securities lending payable
1,520 
1,520 
1,795 
Securities lending collateral
1,517 
1,517 
1,791 
Reductions to the amount of unrecognized tax benefits
5 
5 
 
Unrecognized tax benefits
$ 24 
$ 24 
 
Shareholders' Equity (Detail)
In Millions, except Share data, unless otherwise specified
1 Months Ended 3 Months Ended 9 Months Ended
Aug. 31, 2011
USD ($)
Nov. 30, 2010
USD ($)
Sep. 30, 2013
USD ($)
Sep. 30, 2013
CHF
Sep. 30, 2012
USD ($)
Sep. 30, 2012
CHF
Sep. 30, 2013
USD ($)
Sep. 30, 2013
CHF
Sep. 30, 2012
USD ($)
Sep. 30, 2012
CHF
Dec. 31, 2012
CHF
Stockholders' Equity Note [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Dividends declared per common share
 
 
$ 0.51 
 0.46 
$ 0.49 
 0.45 
$ 1.51 
 1.40 
$ 1.57 
 1.46 
 
Common Shares, par value
 
 
 
 27.49 
 
 
 
 27.49 
 
 
 28.89 
Common Shares in treasury, shares
 
 
2,762,440 
2,762,440 
 
 
2,762,440 
2,762,440 
 
 
2,510,878 
Stock repurchase program, authorized amount
$ 303 
$ 600 
 
 
 
 
 
 
 
 
 
Share repurchase authorization remains
197 
 
 
 
 
 
228 
 
 
 
 
Repurchase of outstanding common shares, shares
 
 
238,544 
238,544 
 
 
2,701,620 
2,701,620 
 
 
 
Share repurchase amount
 
 
$ 21 
 
 
 
$ 233 
 
 
 
 
Increase to dividend approved by shareholders in January
 
 
 
 
 
 
 
 
$ 0.12 
 
 
Par Value Reduction
 
 
 
 
 
 
 
 0.93 
 
 
 
Share-Based Compensation (Detail) (USD $)
1 Months Ended 9 Months Ended 0 Months Ended
May 31, 2013
Sep. 30, 2013
Feb. 28, 2013
Stock Options [Member]
Feb. 28, 2013
Restricted Stock [Member]
Feb. 28, 2013
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
Stock option vesting period in years
 
3 years 
 
 
 
Stock option term in years
 
10 years 
 
 
 
Stock options granted
 
 
1,815,896 
 
 
Weighted-average grant date fair value for stock options granted
 
 
$ 17.29 
 
 
Restricted stock award and units vesting period in years
 
4 years 
 
 
 
Restricted stock awards granted to employees and officers of the company
 
 
 
1,345,850 
 
Restricted stock units awarded to employees and officers of the company
 
 
 
 
266,065 
Grant date fair value of awards except for options granted to employees and officers of the company
 
 
 
$ 85.39 
$ 85.39 
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized
8,000,000 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized
 
38,600,000 
 
 
 
Document Period End Date
 
Sep. 30, 2013 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant
 
11,165,235 
 
 
 
Segment Information (Operations By Segment) (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Segment Reporting Information [Line Items]
 
 
 
 
Net premiums written
$ 4,620 
$ 4,716 
$ 12,809 
$ 12,418 
Net premiums earned
4,610 
4,665 
12,250 
11,829 
Losses and loss expenses
2,655 
3,047 
6,831 
6,970 
Policy benefits
138 
130 
379 
379 
Policy acquisition costs
678 
609 
1,957 
1,810 
Administrative expenses
563 
519 
1,641 
1,543 
Underwriting income (loss)
576 
360 
1,442 
1,127 
Net investment income
522 
533 
1,587 
1,614 
Net realized gains (losses) including OTTI
40 
(60)
350 
(194)
Interest expense
72 
63 
205 
187 
(Gains) losses from fair value changes in separate account assets
(14)
(14)
(7)
(18)
Other
9 
(3)
29 
32 
Other (income) expense
(5)
(17)
22 
14 
Income tax expense (benefit)
155 
147 
392 
405 
Net income (loss)
916 
640 
2,760 
1,941 
Insurance - North American P&C [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Net premiums written
1,500 
1,373 
4,313 
3,915 
Net premiums earned
1,444 
1,306 
4,210 
3,802 
Losses and loss expenses
963 
819 
2,791 
2,474 
Policy acquisition costs
159 
147 
444 
419 
Administrative expenses
153 
148 
437 
451 
Underwriting income (loss)
169 
192 
538 
458 
Net investment income
254 
257 
755 
789 
Net realized gains (losses) including OTTI
9 
(2)
63 
15 
Interest expense
3 
3 
4 
9 
Other
(13)
(13)
(38)
(20)
Income tax expense (benefit)
79 
129 
264 
308 
Net income (loss)
363 
328 
1,126 
965 
Insurance - North American Agriculture [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Underwriting Income Including Losses Related to Crop Derivatives
65 
 
111 
 
Net premiums written
805 
1,164 
1,371 
1,775 
Net premiums earned
849 
1,166 
1,252 
1,609 
Losses and loss expenses
746 
1,291 
1,071 
1,648 
Policy acquisition costs
32 
13 
56 
25 
Administrative expenses
5 
0 
13 
(3)
Underwriting income (loss)
66 
(138)
112 
(61)
Net investment income
6 
6 
19 
19 
Net realized gains (losses) including OTTI
0 
1 
1 
1 
Interest expense
0 
0 
0 
0 
Other
8 
8 
24 
24 
Income tax expense (benefit)
14 
(48)
24 
(29)
Net income (loss)
50 
(91)
84 
(36)
Crop Derivative Reclassification
1 
 
1 
 
Insurance - Overseas General [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Net premiums written
1,571 
1,384 
4,821 
4,387 
Net premiums earned
1,611 
1,432 
4,633 
4,243 
Losses and loss expenses
712 
622 
2,227 
2,030 
Policy acquisition costs
349 
329 
1,048 
996 
Administrative expenses
263 
234 
750 
696 
Underwriting income (loss)
287 
247 
608 
521 
Net investment income
128 
127 
396 
386 
Net realized gains (losses) including OTTI
(8)
13 
34 
59 
Interest expense
1 
2 
4 
4 
Other
14 
(3)
30 
3 
Income tax expense (benefit)
78 
77 
174 
166 
Net income (loss)
314 
311 
830 
793 
Global Reinsurance [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Net premiums written
265 
307 
836 
879 
Net premiums earned
239 
281 
731 
748 
Losses and loss expenses
93 
151 
292 
355 
Policy acquisition costs
52 
40 
148 
125 
Administrative expenses
12 
13 
36 
38 
Underwriting income (loss)
82 
77 
255 
230 
Net investment income
66 
72 
209 
213 
Net realized gains (losses) including OTTI
(5)
(2)
46 
(6)
Interest expense
2 
1 
4 
3 
Other
(7)
(5)
(13)
(7)
Income tax expense (benefit)
16 
11 
31 
17 
Net income (loss)
132 
140 
488 
424 
Life [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Life underwriting income
92 
 
 
 
Net premiums written
479 
488 
1,468 
1,462 
Net premiums earned
467 
480 
1,424 
1,427 
Losses and loss expenses
141 
164 
443 
463 
Policy benefits
138 
130 
379 
379 
Policy acquisition costs
86 
80 
261 
244 
Administrative expenses
85 
81 
256 
237 
Underwriting income (loss)
17 
25 
85 
104 
Net investment income
61 
63 
187 
186 
Net realized gains (losses) including OTTI
43 
(71)
206 
(261)
Interest expense
4 
3 
12 
9 
(Gains) losses from fair value changes in separate account assets
(14)
(14)
(7)
(18)
Other
4 
0 
7 
14 
Income tax expense (benefit)
10 
14 
33 
44 
Net income (loss)
117 
14 
433 
(20)
Corporate And Other [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Losses and loss expenses
0 
0 
7 
0 
Policy acquisition costs
 
0 
 
1 
Administrative expenses
45 
43 
149 
124 
Underwriting income (loss)
(45)
(43)
(156)
(125)
Net investment income
7 
8 
21 
21 
Net realized gains (losses) including OTTI
1 
1 
0 
(2)
Interest expense
62 
54 
181 
162 
Other
3 
10 
19 
18 
Income tax expense (benefit)
(42)
(36)
(134)
(101)
Net income (loss)
$ (60)
$ (62)
$ (201)
$ (185)
Segment Information (Net Premiums Earned For Segment By Product) (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Segment Reporting Information [Line Items]
 
 
 
 
Property & All Other
$ 2,067 
$ 2,197 
$ 4,695 
$ 4,623 
Casualty
1,430 
1,366 
4,237 
3,925 
Life, Accident & Health
1,113 
1,102 
3,318 
3,281 
Net premiums earned
4,610 
4,665 
12,250 
11,829 
Insurance - North American P&C [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Property & All Other
388 
353 
1,103 
1,022 
Casualty
957 
860 
2,826 
2,505 
Life, Accident & Health
99 
93 
281 
275 
Net premiums earned
1,444 
1,306 
4,210 
3,802 
Insurance - North American Agriculture [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Property & All Other
849 
1,166 
1,252 
1,609 
Casualty
0 
0 
0 
0 
Life, Accident & Health
0 
0 
0 
0 
Net premiums earned
849 
1,166 
1,252 
1,609 
Insurance - Overseas General [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Property & All Other
689 
547 
1,932 
1,637 
Casualty
375 
356 
1,088 
1,027 
Life, Accident & Health
547 
529 
1,613 
1,579 
Net premiums earned
1,611 
1,432 
4,633 
4,243 
Global Reinsurance [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Property & All Other
141 
131 
408 
355 
Casualty
98 
150 
323 
393 
Net premiums earned
239 
281 
731 
748 
Life [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Life, Accident & Health
467 
480 
1,424 
1,427 
Net premiums earned
$ 467 
$ 480 
$ 1,424 
$ 1,427 
Earnings Per Share (Detail) (USD $)
In Millions, except Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Earnings Per Share [Abstract]
 
 
 
 
Net income
$ 916 
$ 640 
$ 2,760 
$ 1,941 
Weighted-average shares outstanding
340,888,648 
340,207,037 
340,905,322 
339,523,388 
Share-based compensation plans
2,929,089 
2,665,676 
3,146,728 
2,831,798 
Adjusted weighted-average shares outstanding and assumed conversions
343,817,737 
342,872,713 
344,052,050 
342,355,186 
Basic earnings per share (US$ per share)
$ 2.68 
$ 1.88 
$ 8.09 
$ 5.71 
Diluted earnings per share (US$ per share)
$ 2.66 
$ 1.86 
$ 8.02 
$ 5.67 
Potential anti-dilutive share conversions
1,215,884 
1,449,610 
1,429,514 
1,193,839 
Information Provided In Connection With Outstanding Debt Of Subsidiaries (Condensed Consolidating Balance Sheet) (Detail) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2013
Dec. 31, 2012
Sep. 30, 2012
Dec. 31, 2011
Condensed Financial Statements, Captions [Line Items]
 
 
 
 
Investments
$ 60,342 
$ 60,264 
 
 
Insurance and reinsurance balances receivable
5,089 
4,147 
 
 
Reinsurance recoverable on losses and loss expenses
11,477 
12,078 
 
 
Reinsurance recoverable on policy benefits
237 
241 
 
 
Value of business acquired
554 
614 
 
 
Goodwill and other intangible assets
5,465 
4,975 
 
 
Other assets
10,652 
9,611 
 
 
Total assets
94,584 
92,545 
 
 
Unpaid losses and loss expenses
37,882 
37,946 
 
 
Unearned premiums
7,794 
6,864 
 
 
Future policy benefits
4,596 
4,470 
 
 
Short-term debt
1,902 
1,401 
 
 
Long-term debt
3,807 
3,360 
 
 
Trust preferred securities
309 
309 
 
 
Other liabilities
10,076 
10,664 
 
 
Total liabilities
66,366 
65,014 
 
 
Total shareholders' equity
28,218 
27,531 
26,963 
 
Total liabilities and shareholders’ equity
94,584 
92,545 
 
 
Cash
768 1 2
615 2 3
690 4
614 4
Scenario, Previously Reported [Member]
 
 
 
 
Condensed Financial Statements, Captions [Line Items]
 
 
 
 
Investments
 
60,264 
 
 
Insurance and reinsurance balances receivable
 
4,147 
 
 
Reinsurance recoverable on losses and loss expenses
 
12,078 
 
 
Reinsurance recoverable on policy benefits
 
241 
 
 
Value of business acquired
 
614 
 
 
Goodwill and other intangible assets
 
4,975 
 
 
Other assets
 
9,611 
 
 
Total assets
 
92,545 
 
 
Unpaid losses and loss expenses
 
37,946 
 
 
Unearned premiums
 
6,864 
 
 
Future policy benefits
 
4,470 
 
 
Short-term debt
 
1,401 
 
 
Long-term debt
 
3,360 
 
 
Trust preferred securities
 
309 
 
 
Other liabilities
 
10,664 
 
 
Total liabilities
 
65,014 
 
 
Total shareholders' equity
 
27,531 
 
 
Total liabilities and shareholders’ equity
 
92,545 
 
 
Cash
 
615 3
690 4
614 
Parent Company [Member]
 
 
 
 
Condensed Financial Statements, Captions [Line Items]
 
 
 
 
Investments
29 
31 
 
 
Investments in subsidiaries
28,457 
27,251 
 
 
Due from subsidiaries and affiliates, net
813 
204 
 
 
Other assets
5 
13 
 
 
Total assets
29,315 
27,602 
 
 
Affiliated notional cash pooling programs
872 1
 
 
 
Trust preferred securities
 
0 
 
 
Other liabilities
225 
71 
 
 
Total liabilities
1,097 
71 
 
 
Total shareholders' equity
28,218 
27,531 
 
 
Total liabilities and shareholders’ equity
29,315 
27,602 
 
 
Cash
11 1 2
103 2 3
0 4
106 4
Parent Company [Member] |
Scenario, Previously Reported [Member]
 
 
 
 
Condensed Financial Statements, Captions [Line Items]
 
 
 
 
Investments
 
31 
 
 
Investments in subsidiaries
 
27,251 
 
 
Due from subsidiaries and affiliates, net
 
204 
 
 
Other assets
 
13 
 
 
Total assets
 
27,602 
 
 
Trust preferred securities
 
0 
 
 
Other liabilities
 
71 
 
 
Total liabilities
 
71 
 
 
Total shareholders' equity
 
27,531 
 
 
Total liabilities and shareholders’ equity
 
27,602 
 
 
Cash
 
103 3
(116)4
106 
Guarantor Subsidiaries [Member]
 
 
 
 
Condensed Financial Statements, Captions [Line Items]
 
 
 
 
Investments
10 
14 
 
 
Insurance and reinsurance balances receivable
0 
0 
 
 
Reinsurance recoverable on losses and loss expenses
0 
0 
 
 
Reinsurance recoverable on policy benefits
0 
0 
 
 
Value of business acquired
0 
0 
 
 
Goodwill and other intangible assets
0 
0 
 
 
Investments in subsidiaries
17,979 
17,016 
 
 
Other assets
219 
210 
 
 
Total assets
18,373 
17,242 
 
 
Unpaid losses and loss expenses
0 
0 
 
 
Unearned premiums
0 
0 
 
 
Future policy benefits
0 
0 
 
 
Due to subsidiaries and affiliates, net
661 
68 
 
 
Short-term debt
500 
0 
 
 
Affiliated notional cash pooling programs
0 1
349 1
 
 
Long-term debt
3,795 
3,347 
 
 
Trust preferred securities
309 
309 
 
 
Other liabilities
1,342 
1,195 
 
 
Total liabilities
6,607 
5,268 
 
 
Total shareholders' equity
11,766 
11,974 
 
 
Total liabilities and shareholders’ equity
18,373 
17,242 
 
 
Cash
165 1 2
2 2 3
32 4
5 4
Guarantor Subsidiaries [Member] |
Scenario, Previously Reported [Member]
 
 
 
 
Condensed Financial Statements, Captions [Line Items]
 
 
 
 
Investments
 
31,074 
 
 
Insurance and reinsurance balances receivable
 
3,654 
 
 
Reinsurance recoverable on losses and loss expenses
 
17,232 
 
 
Reinsurance recoverable on policy benefits
 
1,187 
 
 
Value of business acquired
 
610 
 
 
Goodwill and other intangible assets
 
4,419 
 
 
Investments in subsidiaries
 
0 
 
 
Other assets
 
7,563 
 
 
Total assets
 
66,254 
 
 
Unpaid losses and loss expenses
 
31,356 
 
 
Unearned premiums
 
5,872 
 
 
Future policy benefits
 
3,876 
 
 
Due to subsidiaries and affiliates, net
 
384 
 
 
Short-term debt
 
851 
 
 
Long-term debt
 
3,360 
 
 
Trust preferred securities
 
309 
 
 
Other liabilities
 
8,272 
 
 
Total liabilities
 
54,280 
 
 
Total shareholders' equity
 
11,974 
 
 
Total liabilities and shareholders’ equity
 
66,254 
 
 
Cash
 
515 3
550 4
382 
Other Ace Limited Subsidiaries And Eliminations [Member]
 
 
 
 
Condensed Financial Statements, Captions [Line Items]
 
 
 
 
Investments
60,303 
60,219 
 
 
Insurance and reinsurance balances receivable
6,225 
4,742 
 
 
Reinsurance recoverable on losses and loss expenses
20,279 
20,935 
 
 
Reinsurance recoverable on policy benefits
1,246 
1,229 
 
 
Value of business acquired
554 
614 
 
 
Goodwill and other intangible assets
5,465 
4,975 
 
 
Other assets
12,679 
11,304 
 
 
Total assets
108,215 
104,877 
 
 
Unpaid losses and loss expenses
46,215 
46,109 
 
 
Unearned premiums
9,523 
8,248 
 
 
Future policy benefits
5,605 
5,458 
 
 
Due to subsidiaries and affiliates, net
152 
136 
 
 
Short-term debt
1,402 
1,401 
 
 
Affiliated notional cash pooling programs
0 1
0 1
 
 
Long-term debt
12 
13 
 
 
Trust preferred securities
 
0 
 
 
Other liabilities
10,636 
11,219 
 
 
Total liabilities
73,545 
72,584 
 
 
Total shareholders' equity
34,670 
32,293 
 
 
Total liabilities and shareholders’ equity
108,215 
104,877 
 
 
Cash
1,464 1 2
859 2 3
929 4
651 4
Other Ace Limited Subsidiaries And Eliminations [Member] |
Scenario, Previously Reported [Member]
 
 
 
 
Condensed Financial Statements, Captions [Line Items]
 
 
 
 
Investments
 
29,159 5
 
 
Insurance and reinsurance balances receivable
 
493 5
 
 
Reinsurance recoverable on losses and loss expenses
 
(5,154)5
 
 
Reinsurance recoverable on policy benefits
 
(946)5
 
 
Value of business acquired
 
4 5
 
 
Goodwill and other intangible assets
 
556 5
 
 
Other assets
 
2,035 5
 
 
Total assets
 
26,144 5
 
 
Unpaid losses and loss expenses
 
6,590 5
 
 
Unearned premiums
 
992 5
 
 
Future policy benefits
 
594 5
 
 
Due to subsidiaries and affiliates, net
 
(180)5
 
 
Short-term debt
 
550 5
 
 
Long-term debt
 
0 5
 
 
Trust preferred securities
 
0 5
 
 
Other liabilities
 
2,321 5
 
 
Total liabilities
 
10,867 5
 
 
Total shareholders' equity
 
15,277 5
 
 
Total liabilities and shareholders’ equity
 
26,144 5
 
 
Cash
 
(3)3 5
256 4 6
126 6
Consolidation, Eliminations [Member]
 
 
 
 
Condensed Financial Statements, Captions [Line Items]
 
 
 
 
Investments
0 
0 
 
 
Insurance and reinsurance balances receivable
(1,136)
(595)
 
 
Reinsurance recoverable on losses and loss expenses
(8,802)
(8,857)
 
 
Reinsurance recoverable on policy benefits
(1,009)
(988)
 
 
Value of business acquired
0 
0 
 
 
Goodwill and other intangible assets
0 
0 
 
 
Investments in subsidiaries
(46,436)
(44,267)
 
 
Due from subsidiaries and affiliates, net
(813)
(204)
 
 
Other assets
(2,251)
(1,916)
 
 
Total assets
(61,319)
(57,176)
 
 
Unpaid losses and loss expenses
(8,333)
(8,163)
 
 
Unearned premiums
(1,729)
(1,384)
 
 
Future policy benefits
(1,009)
(988)
 
 
Due to subsidiaries and affiliates, net
(813)
(204)
 
 
Short-term debt
0 
0 
 
 
Affiliated notional cash pooling programs
(872)1
(349)1
 
 
Long-term debt
 
0 
 
 
Trust preferred securities
 
0 
 
 
Other liabilities
(2,127)
(1,821)
 
 
Total liabilities
(14,883)
(12,909)
 
 
Total shareholders' equity
(46,436)
(44,267)
 
 
Total liabilities and shareholders’ equity
(61,319)
(57,176)
 
 
Cash
(872)1 2
(349)2 3
(271)4
(148)4
Consolidation, Eliminations [Member] |
Scenario, Previously Reported [Member]
 
 
 
 
Condensed Financial Statements, Captions [Line Items]
 
 
 
 
Investments
 
0 7
 
 
Insurance and reinsurance balances receivable
 
0 7
 
 
Reinsurance recoverable on losses and loss expenses
 
0 7
 
 
Reinsurance recoverable on policy benefits
 
0 7
 
 
Value of business acquired
 
0 7
 
 
Goodwill and other intangible assets
 
0 7
 
 
Investments in subsidiaries
 
(27,251)7
 
 
Due from subsidiaries and affiliates, net
 
(204)7
 
 
Other assets
 
0 7
 
 
Total assets
 
(27,455)7
 
 
Unpaid losses and loss expenses
 
0 7
 
 
Unearned premiums
 
0 7
 
 
Future policy benefits
 
0 7
 
 
Due to subsidiaries and affiliates, net
 
(204)7
 
 
Short-term debt
 
0 7
 
 
Long-term debt
 
0 7
 
 
Trust preferred securities
 
0 7
 
 
Other liabilities
 
0 7
 
 
Total liabilities
 
(204)7
 
 
Total shareholders' equity
 
(27,251)7
 
 
Total liabilities and shareholders’ equity
 
(27,455)7
 
 
Cash
 
$ 0 3 7
$ 0 4 8
$ 0 8
Information Provided In Connection With Outstanding Debt Of Subsidiaries (Condensed Consolidating Statement Of Operations) (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Sep. 30, 2012
Information Provided In Connection With Outstanding Debt Of Subsidiaries [Line Items]
 
 
 
 
Net premiums written
$ 4,620 
$ 4,716 
$ 12,809 
$ 12,418 
Net premiums earned
4,610 
4,665 
12,250 
11,829 
Net investment income
522 
533 
1,587 
1,614 
Net realized gains (losses) including OTTI
40 
(60)
350 
(194)
Losses and loss expenses
2,655 
3,047 
6,831 
6,970 
Policy benefits
138 
130 
379 
379 
Policy acquisition costs and administrative expenses
1,241 
1,128 
3,598 
3,353 
Interest (income) expense
72 
63 
205 
187 
Other (income) expense
(5)
(17)
22 
14 
Income tax expense (benefit)
155 
147 
392 
405 
Net income (loss)
916 
640 
2,760 
1,941 
Comprehensive income (loss)
1,030 
1,316 
1,247 
3,044 
Parent Company [Member]
 
 
 
 
Information Provided In Connection With Outstanding Debt Of Subsidiaries [Line Items]
 
 
 
 
Net investment income
1 
0 
2 
1 
Equity in earnings of subsidiaries
863 
616 
2,619 
1,845 
Net realized gains (losses) including OTTI
0 
(4)
12 
18 
Policy acquisition costs and administrative expenses
13 
16 
40 
42 
Interest (income) expense
(8)
(8)
(23)
(25)
Other (income) expense
(62)
(39)
(157)
(102)
Income tax expense (benefit)
5 
3 
13 
8 
Net income (loss)
916 
640 
2,760 
1,941 
Comprehensive income (loss)
1,030 
1,316 
1,247 
3,044 
Guarantor Subsidiaries [Member]
 
 
 
 
Information Provided In Connection With Outstanding Debt Of Subsidiaries [Line Items]
 
 
 
 
Net premiums written
0 
0 
0 
0 
Net premiums earned
0 
0 
0 
0 
Net investment income
0 
1 
2 
2 
Equity in earnings of subsidiaries
322 
285 
767 
775 
Net realized gains (losses) including OTTI
(2)
0 
(2)
0 
Losses and loss expenses
0 
0 
0 
0 
Policy benefits
0 
0 
0 
0 
Policy acquisition costs and administrative expenses
4 
6 
13 
20 
Interest (income) expense
69 
60 
200 
175 
Other (income) expense
6 
7 
21 
(8)
Income tax expense (benefit)
(14)
(24)
(80)
(72)
Net income (loss)
255 
237 
613 
662 
Comprehensive income (loss)
339 
593 
(195)
1,203 
Other Ace Limited Subsidiaries And Eliminations [Member]
 
 
 
 
Information Provided In Connection With Outstanding Debt Of Subsidiaries [Line Items]
 
 
 
 
Net premiums written
4,620 
4,716 
12,809 
12,418 
Net premiums earned
4,610 
4,665 
12,250 
11,829 
Net investment income
521 
532 
1,583 
1,611 
Net realized gains (losses) including OTTI
42 
(56)
340 
(212)
Losses and loss expenses
2,655 
3,047 
6,831 
6,970 
Policy benefits
138 
130 
379 
379 
Policy acquisition costs and administrative expenses
1,224 
1,106 
3,545 
3,291 
Interest (income) expense
11 
11 
28 
37 
Other (income) expense
51 
15 
158 
124 
Income tax expense (benefit)
164 
168 
459 
469 
Net income (loss)
930 
664 
2,773 
1,958 
Comprehensive income (loss)
1,043 
1,339 
1,259 
3,060 
Consolidation, Eliminations [Member]
 
 
 
 
Information Provided In Connection With Outstanding Debt Of Subsidiaries [Line Items]
 
 
 
 
Equity in earnings of subsidiaries
(1,185)
(901)
(3,386)
(2,620)
Net income (loss)
(1,185)
(901)
(3,386)
(2,620)
Comprehensive income (loss)
(1,382)
(1,932)
(1,064)
(4,263)
Scenario, Previously Reported [Member]
 
 
 
 
Information Provided In Connection With Outstanding Debt Of Subsidiaries [Line Items]
 
 
 
 
Net premiums written
 
4,716 
 
12,418 
Net premiums earned
 
4,665 
 
11,829 
Net investment income
 
533 
 
1,614 
Net realized gains (losses) including OTTI
 
(60)
 
(194)
Losses and loss expenses
 
3,047 
 
6,970 
Policy benefits
 
130 
 
379 
Policy acquisition costs and administrative expenses
 
1,128 
 
3,353 
Interest (income) expense
 
(63)
 
(187)
Other (income) expense
 
17 
 
(14)
Income tax expense (benefit)
 
147 
 
405 
Net income (loss)
 
640 
 
1,941 
Comprehensive income (loss)
 
1,316 
 
3,044 
Scenario, Previously Reported [Member] |
Parent Company [Member]
 
 
 
 
Information Provided In Connection With Outstanding Debt Of Subsidiaries [Line Items]
 
 
 
 
Net investment income
 
0 
 
1 
Equity in earnings of subsidiaries
 
616 
 
1,845 
Net realized gains (losses) including OTTI
 
(4)
 
18 
Policy acquisition costs and administrative expenses
 
16 
 
42 
Interest (income) expense
 
8 
 
25 
Other (income) expense
 
39 
 
102 
Income tax expense (benefit)
 
3 
 
8 
Net income (loss)
 
640 
 
1,941 
Comprehensive income (loss)
 
1,316 
 
3,044 
Scenario, Previously Reported [Member] |
Guarantor Subsidiaries [Member]
 
 
 
 
Information Provided In Connection With Outstanding Debt Of Subsidiaries [Line Items]
 
 
 
 
Net premiums written
 
2,868 
 
7,293 
Net premiums earned
 
2,819 
 
6,967 
Net investment income
 
255 
 
777 
Equity in earnings of subsidiaries
 
0 
 
0 
Net realized gains (losses) including OTTI
 
11 
 
71 
Losses and loss expenses
 
1,977 
 
4,484 
Policy benefits
 
77 
 
217 
Policy acquisition costs and administrative expenses
 
587 
 
1,883 
Interest (income) expense
 
(67)
 
(191)
Other (income) expense
 
(17)
 
(51)
Income tax expense (benefit)
 
123 
 
327 
Net income (loss)
 
237 
 
662 
Comprehensive income (loss)
 
593 
 
1,203 
Scenario, Previously Reported [Member] |
Other Ace Limited Subsidiaries And Eliminations [Member]
 
 
 
 
Information Provided In Connection With Outstanding Debt Of Subsidiaries [Line Items]
 
 
 
 
Net premiums written
 
1,848 1
 
5,125 1
Net premiums earned
 
1,846 1
 
4,862 1
Net investment income
 
278 1
 
836 1
Net realized gains (losses) including OTTI
 
(67)1
 
(283)1
Losses and loss expenses
 
1,070 1
 
2,486 1
Policy benefits
 
53 1
 
162 1
Policy acquisition costs and administrative expenses
 
525 1
 
1,428 1
Interest (income) expense
 
(4)1
 
(21)1
Other (income) expense
 
(5)1
 
(65)1
Income tax expense (benefit)
 
21 1
 
70 1
Net income (loss)
 
379 1
 
1,183 1
Comprehensive income (loss)
 
23 1
 
642 1
Scenario, Previously Reported [Member] |
Consolidation, Eliminations [Member]
 
 
 
 
Information Provided In Connection With Outstanding Debt Of Subsidiaries [Line Items]
 
 
 
 
Equity in earnings of subsidiaries
 
(616)2
 
(1,845)2
Net income (loss)
 
(616)2
 
(1,845)2
Comprehensive income (loss)
 
$ (616)2
 
$ (1,845)2
Information Provided In Connection With Outstanding Debt Of Subsidiaries (Condensed Consolidating Statement Of Cash Flows) (Detail) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2013
Sep. 30, 2012
Sep. 30, 2013
Parent Company [Member]
Sep. 30, 2012
Parent Company [Member]
Sep. 30, 2013
Guarantor Subsidiaries [Member]
Sep. 30, 2012
Guarantor Subsidiaries [Member]
Sep. 30, 2013
Other Ace Limited Subsidiaries And Eliminations [Member]
Sep. 30, 2012
Other Ace Limited Subsidiaries And Eliminations [Member]
Sep. 30, 2013
Consolidation, Eliminations [Member]
Sep. 30, 2012
Consolidation, Eliminations [Member]
Sep. 30, 2012
Scenario, Previously Reported [Member]
Sep. 30, 2012
Scenario, Previously Reported [Member]
Parent Company [Member]
Sep. 30, 2012
Scenario, Previously Reported [Member]
Guarantor Subsidiaries [Member]
Sep. 30, 2012
Scenario, Previously Reported [Member]
Other Ace Limited Subsidiaries And Eliminations [Member]
Sep. 30, 2012
Scenario, Previously Reported [Member]
Consolidation, Eliminations [Member]
Information Provided In Connection With Outstanding Debt Of Subsidiaries [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net cash flows from operating activities
$ 2,736 
$ 3,025 
$ 80 
$ 136 
$ 2 
$ 127 
$ 2,654 
$ 2,882 
$ 0 
$ (120)
$ 3,025 
$ 210 
$ 1,553 
$ 1,262 1
$ 0 2
Purchases of fixed maturities available for sale
(15,889)
(17,656)
 
 
4 
0 
(15,996)
(17,803)
(103)
147 
(17,656)
 
(8,553)
(9,103)1
0 2
Purchases of fixed maturities held to maturity
(374)
(217)
 
 
0 
0 
(374)
(217)
0 
0 
(217)
 
(215)
(2)1
0 2
Purchases of equity securities
(217)
(114)
 
 
0 
0 
(217)
(114)
0 
0 
(114)
 
(65)
(49)1
0 2
Sales of fixed maturities available for sale
(8,012)
(11,355)
 
0 
0 
0 
(8,115)
(11,502)
(103)
147 
(11,355)
0 
(5,154)
(6,201)1
0 2
Sales of equity securities
99 
57 
 
 
0 
0 
99 
57 
0 
0 
57 
 
48 
9 1
0 2
Maturities and redemptions of fixed maturities available for sale
5,538 
3,596 
 
 
0 
0 
5,538 
3,596 
0 
0 
3,596 
 
1,757 
1,839 1
0 2
Maturities and redemptions of fixed maturities held to maturity
1,233 
1,092 
 
 
0 
0 
1,233 
1,092 
0 
0 
1,092 
 
798 
294 1
0 2
Net derivative instruments settlements
(376)
(358)
0 
(1)
(1)
0 
(375)
(357)
0 
0 
(358)
(1)
(10)
(347)1
0 2
Payments To From Affiliates
 
 
 
 
 
 
 
 
 
 
 
36 
 
 
(36)2
Acquisition of subsidiaries
(977)
(98)
 
 
0 
0 
(977)
(98)
0 
0 
(98)
 
(98)
0 1
0 2
Payment Of Contributions To Subsidiary
 
 
(133)
 
(1,010)
(89)
0 
(90)
1,143 
179 
 
 
0 
(90)1
90 2
Other
(188)
(339)
 
 
(5)
(2)
(183)
(337)
0 
0 
(339)
 
(279)
(60)1
0 2
Net cash flows used for investing activities
(3,139)
(2,682)
(133)
(1)
(1,012)
(91)
(3,137)
(2,769)
1,143 
179 
(2,682)
35 
(1,463)
(1,308)1
54 2
Dividends paid on Common Shares
(343)
(484)
(343)
(484)
 
 
0 
 
0 
 
(484)
(484)
 
 
 
Common Shares repurchased
(233)
(11)
 
 
 
 
(233)
(11)
0 
0 
(11)
 
 
(11)1
0 2
Proceeds from issuance of long-term debt
947 
0 
 
 
947 
 
 
 
 
 
 
 
 
 
 
Net proceeds from (repayments) issuance of short-term debt
1 
151 
 
0 
0 
0 
1 
151 
0 
0 
151 
0 
1 
150 1
0 2
Proceeds from share-based compensation plans, including windfall tax benefits
112 
73 
7 
17 
0 
 
105 
56 
0 
0 
73 
17 
 
56 1
0 2
Advances (to) from affiliates
 
 
(575)
110 
575 
(106)
0 
(4)
0 
0 
 
0 
(10)
(26)1
36 2
Cash Dividends Paid to Parent Company
 
 
 
 
 
 
 
(120)
 
120 
 
 
 
 
 
Net proceeds from (payments to) affiliated notional cash pooling program
 
 
872 3
116 4
(349)3
7 4
0 3
0 4
(523)3
(123)4
 
 
 
 
 
Other
68 
0 
 
 
0 
 
68 
 
 
 
 
 
 
 
 
Net cash flows from (used for) financing activities
552 
(271)
(39)
(241)
1,173 
(9)
1,084 
161 
(1,666)
(182)
(271)
(467)
81 
169 1
(54)2
Effect of foreign currency rate changes on cash and cash equivalents
4 
4 
 
 
0 
0 
4 
4 
0 
0 
4 
 
(3)
7 1
0 2
Net increase in cash
153 
76 
(92)
(106)
163 
27 
605 
278 
(523)
(123)
76 
(222)
168 
130 1
0 2
Cash – beginning of period
615 3 5
614 4
103 3 5
106 4
2 3 5
5 4
859 3 5
651 4
(349)3 5
(148)4
614 
106 
382 
126 1
0 2
Cash – end of period
768 3 6
690 4
11 3 6
0 4
165 3 6
32 4
1,464 3 6
929 4
(872)3 6
(271)4
690 4
(116)4
550 4
256 1 4
0 2 4
Payments for (Proceeds from) Businesses and Interest in Affiliates
 
 
 
 
$ 0 
$ 90 
$ 1,143 
$ 89 
$ (1,143)
$ (179)
 
 
$ 90 
$ 0 1
$ (90)2