UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
Current Report
 
Pursuant To Section 13 or 15 (d) of the
Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported) – February 5, 2008
 
ACE LIMITED
(Exact name of registrant as specified in its charter)

Cayman Islands	 	1-11778	 	98-0091805	
(State or other jurisdiction
of Incorporation)	 	(Commission File Number)	 	(I.R.S. Employer
Identification No.)	
 
ACE Global Headquarters
17 Woodbourne Avenue
Hamilton HM 08 Bermuda
(Address of principal executive offices)
 
Registrant’s telephone number, including area code: (441) 295-5200
 
Not applicable
(Former name or former address, if changed since last report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see General Instruction A.2. below):
 
¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)	
 
¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)	
 
¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))	
 
¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))	

 

Item 2.02. Results of Operations and Financial Condition
 
On February 5, 2008, ACE Limited issued a press release reporting its fourth quarter 2007 results and the availability of its fourth quarter financial supplement. The press release and the financial supplement are attached hereto as Exhibit 99.1 and Exhibit 99.2, respectively, and are hereby incorporated herein by reference.
 
Item 9.01. Financial Statements, Pro Forma Financial Information and Exhibits.
 
(c)	Exhibits	

Exhibit
  Number  	 	  Description	
		
99.1	 	Press release, dated February 5, 2008, reporting fourth quarter results	
		
99.2	 	Fourth Quarter 2007 Financial Supplement	

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

ACE LIMITED	
		
By:	 	/s/ Philip V. Bancroft     	
	 	Philip V. Bancroft	
	 	Chief Financial Officer 	
 
DATE: February 5, 2008

EXHIBIT INDEX

  Number  	 	  Description  	  	  Method of Filing  	
			
99.1	 	Press release, dated February 5 2008, reporting fourth quarter results	  	Furnished herewith	
			
99.2	 	Fourth Quarter 2007 Financial Supplement	  	Furnished herewith	

Exhibit 99.1

	 		 		 		
	 		 		 		
	 	ACE Limited
ACE Global Headquarters            
17 Woodbourne Avenue
Hamilton HM 08
Bermuda	 	PO Box HM 1015
Hamilton HM DX
Bermuda
 
441 295-5200 main
441 292-8675 fax
 
www.acelimited.com        	 		

FOR IMMEDIATE RELEASE

	 		 	Investor Contact:	 	Helen M. Wilson
(441) 299-9283 helen.wilson@ace.bm	
				
	 		 	Media Contact:    	 	Robert T. Grieves
(212) 827-4444
robert.grieves@ace-ina.com	

ACE REPORTS FOURTH QUARTER 2007 NET INCOME OF $572 MILLION,
OPERATING INCOME UP 8% TO RECORD $693 MILLION;
FULL YEAR 2007 NET INCOME INCREASES 12% TO RECORD $2,578 MILLION,
OPERATING INCOME UP 15% TO RECORD $2,712 MILLION
 
HAMILTON, Bermuda, February 5, 2008 — ACE Limited (NYSE: ACE) today reported net income for the fourth quarter ended December 31, 2007, of $1.69 per common share after payment of preferred dividends, compared with $1.99 per share for the same quarter last year. Income excluding net realized gains (losses) for the fourth quarter was $2.05 per share, compared with $1.92 per share for the same quarter of last year. (1) Book value increased 4% for the quarter, and annualized return on average equity was 17.2%. (2) The net realized and unrealized loss after tax was $15 million for the quarter. The overall mark-to-market impact on our investment portfolio was a pre-tax gain of $106 million.

Fourth Quarter Summary
(in millions, except per share amounts)
(Unaudited)

 	  	 	 	 	 	  	 	 	 	(Per Share – Diluted)	 	
 	  	2007	 	 	2006	  	Change	 	 	2007	 	 	2006	  	Change	 	
Net income	  	$	572	 	 	$	665	  	(14	)%	 	$	1.69	 	 	$	1.99	  	(15	)%	
Net realized gains (losses), net of tax	  	 	(121	)	 	 	22	  	—  	 	 	 	(0.36	)	 	 	0.07	  	—  	 	
Income excluding net realized gains (losses), net of tax (1)	  	$	693	 	 	$	643	  	8	%	 	$	2.05	 	 	$	1.92	  	7	%	
 
Page 1/7

Net income for the year was $7.66 per share, an increase of 11% over prior year. For 2007, income excluding net realized gains (losses) and cumulative effect of an accounting change (3) was $8.07 per share, compared with $7.05 per share for 2006. (1) The combined ratio for the year was 87.9%, compared with 88.1% for 2006. Book value increased 17% and return on equity for the year was 17.9%. ( 2)
 
Full Year Summary
(in millions, except per share amounts)
(Unaudited)

 	  	 	 	 	 	 	 	 	 	 	(Per Share – Diluted)	 	
 	  	2007	 	 	2006	 	 	Change	 	 	2007	 	 	2006	 	 	Change	 	
Net income	  	$	2,578	 	 	$	2,305	 	 	12	%	 	$	7.66	 	 	$	6.91	 	 	11	%	
Net realized gains (losses), net of tax	  	 	(134	)	 	 	(50	)	 	—  	 	 	 	(0.41	)	 	 	(0.15	)	 	—  	 	
Cumulative effect, net of tax (3)	  	 	—  	 	 	 	4	 	 	—  	 	 	 	—  	 	 	 	0.01	 	 	—  	 	
Income excluding net realized gains (losses) and cumulative effect, net of tax (1)	  	$	2,712	 	 	$	2,351	 	 	15	%	 	$	8.07	 	 	$	7.05	 	 	14	%	
 
Evan Greenberg, Chairman and Chief Executive Officer of ACE Limited, commented: “ACE had a strong fourth quarter that capped an excellent year for the Company. All areas of the Company performed well, and the financial markets crisis had a relatively modest impact on our results. For the year, we achieved record net income and net operating income, which increased 12% and 15%, respectively, while book value per share increased 16%. (4) In December we announced two acquisitions that will further diversify and contribute to ACE’s future earnings. Looking ahead, we are well positioned to manage through an increasingly difficult environment marked by continuing volatility in the financial markets, deteriorating economic fundamentals and a softening property and casualty market.”
 
Other operating highlights were as follows:
 
 	•	 	Net premiums written declined 1.3% over the prior year quarter and 0.4% over the full year.	
 	•	 	Net premiums earned increased 1% over the prior year quarter and 4% over the full year.	
 	•	 	The P&C combined ratio for the quarter was 88.1% compared with 88.2% in the prior year quarter; for the full year the P&C combined ratio was 87.9% compared with 88.1% for 2006.	
 	•	 	P&C underwriting income was $351 million for the quarter and $1.4 billion for the full year.	
 	•	 	Operating cash flow amounted to $823 million for the quarter and $4.7 billion for the full year.	
 	•	 	Invested assets increased by $5.1 billion or 14% during the year to $42.3 billion.	
 	•	 	Net loss reserves increased 8% for the full year to $22.7 billion.	
 	•	 	Net investment income increased 18% over the prior year quarter and 20% for the year to $1.9 billion.	
 	•	 	Shareholders’ equity increased 17% for the year to $16.7 billion.	
 	•	 	Tangible equity (1)  rose to nearly $14 billion, an increase of 21% from year-end 2006.	

 	•	 	Return on average equity for 2007 was 17.9%; excluding FAS 115, it was 18.6%. (2)	

 	•	 	Book value per share increased 4% from September 30, 2007, and 16% for the year to $48.89. (4)	
 
Details of our financial results for our business segments are available in the financial supplement. Key segment items include:
 
Page 2/7

 	•	 	Insurance-North American: Net premiums written decreased 7% over the prior year quarter. The combined ratio was 89.1%.	
 
 	•	 	Insurance-Overseas General: Net premiums written increased 10% over the prior year quarter. The combined ratio was 87.5%.	
 
 	•	 	Global Reinsurance: Net premiums written decreased 31% over the prior year quarter. The combined ratio was 73.6%.	
 
 	•	 	Life Insurance and Reinsurance: Net premiums written increased 42% over the prior year quarter. Income excluding net realized gains (losses) decreased 21% to $33 million over the prior year quarter. Net realized losses of $108 million are primarily attributable to the mark-to-market impact of our guaranteed minimum income benefit liabilities that are accounted for as derivatives.	
 
 	•	 	Corporate and Other: Net realized losses of $73 million are attributable to our investment in Assured Guaranty Ltd. and their reported unrealized mark-to-market loss on derivatives associated with financial guaranties written as credit default swaps.	
 
Please refer to the ACE Limited Financial Supplement dated December 31, 2007, which is posted on the Company’s website in the Investor Information section, and access Financial Reports for more detailed information on individual segment performance, together with additional disclosure on reinsurance recoverable, loss reserves, investment portfolio and capital structure. The URL reference is: http://media.corporate-ir.net/media_files/nys/ace/reports/fin_supp_december_31_2007.xls . (Due to the length of this URL, it may be necessary to copy and paste this hyperlink into your Internet browser’s URL address field.)
 
ACE will host its fourth quarter earnings conference call and webcast on Wednesday, February 6, 2008, beginning at 8:30 a.m. ET. The earnings conference call will be available via live and archived webcast at www.acelimited.com or by dialing 888-819-8006 (within the United States) or 913-312-0823 (international); passcode 6462453. Please refer to the ACE Limited website in the Investor Information section under Calendar of Events for details. A replay of the call will be available for approximately one month. To listen to the replay, dial: 888-203-1112 (in the United States) or 719-457-0820 (international); passcode 6462453.
 
The ACE Group of Companies is a global leader in insurance and reinsurance serving a diverse group of clients. Headed by ACE Limited, a component of the Standard & Poor’s 500 stock index, the ACE Group of Companies conducts its business on a worldwide basis with operating subsidiaries in more than 50 countries. Additional information can be found at: www.acelimited.com.
 
1 Non-GAAP Financial Measures:
Operating Income or Income excluding net realized gains (losses) and cumulative effect, net of tax is a common performance measurement for insurance companies. We believe this presentation enhances the understanding of our results of operations by highlighting the underlying profitability of our insurance business. We exclude net realized gains (losses) and net realized gains (losses) included in Other (income) expense related to partially-owned insurance companies because the amount of these gains (losses) is heavily influenced by, and fluctuates in part according to, the availability of market opportunities. We exclude the cumulative effect of a change in accounting principle net of tax because this amount resulted in a one-time adjustment to income.
Underwriting income is calculated by subtracting losses and loss expenses, life and annuity benefits, policy acquisition costs and administrative expenses from net premiums earned. We use underwriting income and operating ratios to monitor the results of our operations without the impact of certain factors, including net investment income, other (income) expense, interest and income tax expense and net realized gains (losses). We believe the use of these measures enhances the understanding of our results of operations by highlighting the underlying profitability of our insurance business.
Tangible shareholders’ equity is shareholders’ equity less goodwill. See reconciliation of Non-GAAP Financial Measures beginning on page 24 in the financial supplement.
These measures should not be viewed as a substitute for net income determined in accordance with generally accepted accounting principles (GAAP).
 
Page 3/7

2 Calculated using income excluding net realized gains (losses).
3 The cumulative effect is a benefit resulting from the inclusion of a forfeiture rate on restricted stock in our stock compensation expense calculations, as required under Financial Accounting Standard (FAS) 123R.
4 Book value per ordinary share is ordinary shareholders’ equity divided by the shares outstanding. Tangible book value per ordinary share is ordinary shareholders’ equity less goodwill divided by the shares outstanding.

Cautionary Statement Regarding Forward-Looking Statements :
 
Forward-looking statements made in this press release reflect the Company’s current views with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties, which may cause actual results to differ materially from those set forth in these statements. For example, the Company’s forward-looking statements could be affected by competition, pricing and policy term trends, the levels of new and renewal business achieved, market acceptance, changes in demand, the frequency of unpredictable catastrophic events, actual loss experience, uncertainties in the reserving or settlement process, new theories of liability, judicial, legislative, regulatory and other governmental developments, litigation tactics and developments, investigation developments and actual settlement terms, the amount and timing of reinsurance recoverable, credit developments among reinsurers, actual market developments, rating agency action, possible terrorism or the outbreak and effects of war and economic, political, regulatory, insurance and reinsurance business conditions, as well as management’s response to these factors, and other factors identified in the Company’s filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
 
(tables to follow)
 
Page 4/7

 
ACE Limited
Summary Consolidated Balance Sheets
(in millions of U.S. dollars, except per share data)
(Unaudited)

							
 	  	December 31
2007	  	December 31
2006	
Assets	  			  			
Total investments	  	$	41,779	  	$	36,601	
Cash	  	 	510	  	 	565	
Insurance and reinsurance balances receivable	  	 	3,540	  	 	3,580	
Reinsurance recoverable	  	 	14,362	  	 	14,580	
Other assets	  	 	11,899	  	 	11,809	
	  	 	 	  	 	 	
Total assets	  	$	72,090	  	$	67,135	

Liabilities	  			  			
Unpaid losses and loss expenses	  	$	37,112	  	$	35,517	
Unearned premium	  	 	6,227	  	 	6,437	
Other Liabilities	  	 	12,074	  	 	10,903	
	  	 	 	  	 	 	
Total liabilities	  	$	55,413	  	$	52,857	

Shareholders’ equity	  			  			
Total shareholders’ equity	  	$	16,677	  	$	14,278	
	  	 	 	  	 	 	
Total liabilities and shareholders’ equity	  	$	72,090	  	$	67,135	

Book value per ordinary share (4)	  	$	48.89	  	$	42.03	

 
Page 5/7

 
ACE Limited
Summary Consolidated Financial Data
(in millions of U.S. dollars, except per share data, and ratios)
(Unaudited)

																	
 	  	Three Months Ended
December 31	 	 	Year Ended
December 31	 	
 	  	2007	 	 	2006	 	 	2007	 	 	2006	 	
					
Gross premiums written	  	$	4,144	 	 	$	4,010	 	 	$	17,740	 	 	$	17,401	 	
Net premiums written	  	 	2,827	 	 	 	2,864	 	 	 	11,979	 	 	 	12,030	 	
Net premiums earned	  	 	3,057	 	 	 	3,026	 	 	 	12,297	 	 	 	11,825	 	
					
Losses and loss expenses	  	 	1,788	 	 	 	1,824	 	 	 	7,351	 	 	 	7,070	 	
Life and annuity benefits	  	 	60	 	 	 	32	 	 	 	168	 	 	 	123	 	
Policy acquisition costs	  	 	457	 	 	 	433	 	 	 	1,771	 	 	 	1,715	 	
Administrative expenses	  	 	385	 	 	 	365	 	 	 	1,455	 	 	 	1,456	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (loss) (1)	  	 	367	 	 	 	372	 	 	 	1,552	 	 	 	1,461	 	
					
Net investment income	  	 	504	 	 	 	428	 	 	 	1,918	 	 	 	1,601	 	
Net realized gains (losses)	  	 	(66	)	 	 	15	 	 	 	(61	)	 	 	(98	)	
Interest expense	  	 	43	 	 	 	42	 	 	 	175	 	 	 	176	 	
Other (income) expense	  	 	49	 	 	 	(16	)	 	 	81	 	 	 	(35	)	
Income tax expense (benefit)	  	 	141	 	 	 	124	 	 	 	575	 	 	 	522	 	
Cumulative effect, net of tax	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	4	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	 	572	 	 	 	665	 	 	 	2,578	 	 	 	2,305	 	
Preferred share dividend	  	 	(12	)	 	 	(12	)	 	 	(45	)	 	 	(45	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income available to holders of ordinary shares	  	$	560	 	 	$	653	 	 	$	2,533	 	 	$	2,260	 	

Diluted earnings per share:	  				 				 				 				
Income excluding net realized gains (losses) and cumulative effect (1)	  	$	2.05	 	 	$	1.92	 	 	$	8.07	 	 	$	7.05	 	
Net income	  	$	1.69	 	 	$	1.99	 	 	$	7.66	 	 	$	6.91	 	
					
Weighted average diluted shares outstanding	  	 	331.3	 	 	 	328.4	 	 	 	330.4	 	 	 	327.2	 	
					
Loss and loss expense ratio	  	 	60.4	%	 	 	61.8	%	 	 	61.6	%	 	 	61.2	%	
Policy acquisition cost ratio	  	 	15.1	%	 	 	14.4	%	 	 	14.5	%	 	 	14.6	%	
Administrative expense ratio	  	 	12.6	%	 	 	12.0	%	 	 	11.8	%	 	 	12.3	%	
Combined ratio	  	 	88.1	%	 	 	88.2	%	 	 	87.9	%	 	 	88.1	%	

 
Page 6/7

 
ACE Limited
Consolidated Supplemental Information
(in millions of U.S. dollars)
(Unaudited)

																	
 	  	Three Months Ended
December 31	 	 	Year Ended
December 31	 	
 	  	2007	 	 	2006	 	 	2007	 	 	2006	 	
					
Gross Premiums Written	  				 				 				 				
					
Insurance — North American	  	$	2,274	 	 	$	2,236	 	 	$	9,840	 	 	$	9,663	 	
Insurance — Overseas General	  	 	1,584	 	 	 	1,441	 	 	 	6,291	 	 	 	5,897	 	
Global Reinsurance	  	 	177	 	 	 	255	 	 	 	1,218	 	 	 	1,567	 	
Life Insurance and Reinsurance	  	 	109	 	 	 	78	 	 	 	391	 	 	 	274	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	4,144	 	 	$	4,010	 	 	$	17,740	 	 	$	17,401	 	

Net Premiums Written	  				 				 				 				
					
Insurance — North American	  	$	1,373	 	 	$	1,476	 	 	$	5,833	 	 	$	5,940	 	
Insurance — Overseas General	  	 	1,169	 	 	 	1,059	 	 	 	4,568	 	 	 	4,266	 	
Global Reinsurance	  	 	174	 	 	 	251	 	 	 	1,197	 	 	 	1,550	 	
Life Insurance and Reinsurance	  	 	111	 	 	 	78	 	 	 	381	 	 	 	274	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	2,827	 	 	$	2,864	 	 	$	11,979	 	 	$	12,030	 	

Net Premiums Earned	  				 				 				 				
					
Insurance — North American	  	$	1,418	 	 	$	1,471	 	 	$	6,007	 	 	$	5,719	 	
Insurance — Overseas General	  	 	1,229	 	 	 	1,097	 	 	 	4,623	 	 	 	4,321	 	
Global Reinsurance	  	 	312	 	 	 	380	 	 	 	1,299	 	 	 	1,511	 	
Life Insurance and Reinsurance	  	 	98	 	 	 	78	 	 	 	368	 	 	 	274	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	3,057	 	 	$	3,026	 	 	$	12,297	 	 	$	11,825	 	

Income Excluding Net Realized Gains (Losses) and Cumulative Effect (1)	  				 				 				 				
					
Insurance — North American	  	$	329	 	 	$	304	 	 	$	1,269	 	 	$	1,132	 	
Insurance — Overseas General	  	 	210	 	 	 	187	 	 	 	818	 	 	 	754	 	
Global Reinsurance	  	 	146	 	 	 	148	 	 	 	559	 	 	 	536	 	
Life Insurance and Reinsurance	  	 	33	 	 	 	42	 	 	 	166	 	 	 	138	 	
Corporate	  	 	(25	)	 	 	(38	)	 	 	(100	)	 	 	(209	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	693	 	 	$	643	 	 	$	2,712	 	 	$	2,351	 	

 
 
Page 7/7

Exhibit 99.2

 
			
	    	Financial Supplement
 
December 31, 2007	
		
Investor Contact
 
Helen M. Wilson
Phone: (441) 299-9283
Fax: (441) 292-8675	    	This report is for informational purposes only. It should be read in conjunction with documents filed by ACE Limited with the Securities and Exchange Commission, including the most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.	
		
email: investorrelations@ace.bm	    	Cautionary Statement Regarding Forward-Looking Statements:	
		
	    	Forward-looking statements made in this financial supplement reflect the Company’s current views with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties which may cause actual results to differ materially from those set forth in these statements. For example, the Company’s forward-looking statements, such as statements concerning exposures, reserves and recoverables, could be affected by the frequency of unpredictable catastrophic events, actual loss experience, uncertainties in the reserving or settlement process, new theories of liability, judicial, legislative, regulatory and other governmental developments, litigation tactics and developments, investigation developments and actual settlement terms, the amount and timing of reinsurance receivable and credit developments among reinsurers.
 
The Company’s forward-looking statements could also be affected by competition, pricing and policy term trends, the levels of new and renewal business achieved, market acceptance, changes in demand, actual market developments, rating agency action, possible terrorism or the outbreak and effects of war, and changes in the financial, securities, and capital markets and the investment community. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.	

					
	 	ACE Limited
Financial Supplement Table of Contents	 		

 	  	 	  	Page	
I.	  	Financial Highlights	  		
	  	- Consolidated Financial Highlights	  	1	
			
II.	  	Consolidated Results	  		
	  	- Consolidated Results - Consecutive Quarters	  	2	
	  	- Summary Consolidated Balance Sheets	  	3	
	  	- Consolidated Premiums by Line of Business	  	4	
	  	- Consolidating Statement of Operations 	  	5-6 	
	  	- Financial Institutions Portfolio	  	7	
			
III .	  	Segment Results	  		
	  	- Insurance - North American	  	8	
	  	- Insurance - Overseas General 	  	9 	
	  	- Global Reinsurance	  	10-11	
	  	- Life Insurance and Reinsurance	  	12	
			
IV.	  	Balance Sheet Details	  		
	  	- Loss Reserve Rollforward	  	13	
	  	- Reinsurance Recoverable Analysis	  	14-17	
	  	- Investment Portfolio 	  	18-20 	
	  	- Net Realized and Unrealized Gains (Losses)	  	21	
	  	- Capital Structure	  	22	
	  	- Computation of Basic and Diluted Earnings Per Share	  	23	
			
V.	  	Other Disclosures	  		
	  	- Non-GAAP Financial Measures	  	24	
	  	- Book Value per Ordinary Share	  	25	
	  	- Comprehensive Income	  	26	
	  	- Glossary	  	27	

			
	  	ACE Limited
Consolidated Financial Highlights
(in millions of U.S. dollars, except share, per share data and ratios)
(Unaudited)	

	  		

 	  	Three months ended December 31	 	 	 	 	 	Year ended December 31	 	 	 	 	
 	  	2007	 	 	2006	 	 	% Change
4Q-07 vs.
4Q-06	 	 	2007	 	 	2006	 	 	% Change
2007 vs.
2006	 	
Gross premiums written	  	$	4,144	 	 	$	4,010	 	 	3	%	 	$	17,740	 	 	$	17,401	 	 	2	%	
							
Net premiums written	  	$	2,827	 	 	$	2,864	 	 	-1	%	 	$	11,979	 	 	$	12,030	 	 	0	%	
							
Net premiums earned	  	$	3,057	 	 	$	3,026	 	 	1	%	 	$	12,297	 	 	$	11,825	 	 	4	%	
							
Net investment income	  	$	504	 	 	$	428	 	 	18	%	 	$	1,918	 	 	$	1,601	 	 	20	%	
							
Net income	  	$	572	 	 	$	665	 	 	-14	%	 	$	2,578	 	 	$	2,305	 	 	12	%	
							
Income excluding net realized gains (losses) and cumulative effect (1)	  	$	693	 	 	$	643	 	 	8	%	 	$	2,712	 	 	$	2,351	 	 	15	%	
							
Comprehensive income	  	$	685	 	 	$	824	 	 	-17	%	 	$	2,643	 	 	$	2,700	 	 	-2	%	
							
Operating cash flow	  	$	823	 	 	$	804	 	 	2	%	 	$	4,701	 	 	$	4,105	 	 	15	%	
							
Combined ratio	  				 				 			 				 				 			
Loss and loss expense ratio	  	 	60.4	%	 	 	61.8	%	 			 	 	61.6	%	 	 	61.2	%	 			
Underwriting and administrative expense ratio	  	 	27.7	%	 	 	26.4	%	 			 	 	26.3	%	 	 	26.9	%	 			
	  	 	 	 	 	 	 	 	 			 	 	 	 	 	 	 	 	 			
Combined ratio	  	 	88.1	%	 	 	88.2	%	 			 	 	87.9	%	 	 	88.1	%	 			
							
Annualized ROE*	  	 	17.2	%	 	 	19.0	%	 			 	 	17.9	%	 	 	18.5	%	 			
Annualized ROE, excluding FAS 115*	  	 	17.8	%	 	 	19.8	%	 			 	 	18.6	%	 	 	19.2	%	 			
							
Effective tax rate on income excluding net realized gains (losses) and cumulative effect	  	 	17	%	 	 	17	%	 			 	 	18	%	 	 	20	%	 			
							
Diluted earnings per share	  				 				 			 				 				 			
Income excluding net realized gains (losses) and cumulative effect (1)	  	$	2.05	 	 	$	1.92	 	 	7	%	 	$	8.07	 	 	$	7.05	 	 	14	%	
Net income	  	$	1.69	 	 	$	1.99	 	 	-15	%	 	$	7.66	 	 	$	6.91	 	 	11	%	
							
Book value per ordinary share	  	$	48.89	 	 	$	42.03	 	 	16	%	 	$	48.89	 	 	$	42.03	 	 	16	%	
Tangible book value per ordinary share	  	$	40.61	 	 	$	33.66	 	 	21	%	 	$	40.61	 	 	$	33.66	 	 	21	%	
							
Weighted average basic ordinary shares outstanding	  	 	325.6	 	 	 	322.5	 	 			 	 	324.9	 	 	 	321.8	 	 			
Weighted average diluted ordinary shares outstanding	  	 	331.3	 	 	 	328.4	 	 			 	 	330.4	 	 	 	327.2	 	 			
Debt/ total capitalization	  	 	11.4	%	 	 	12.8	%	 			 	 	11.4	%	 	 	12.8	%	 			
 
(1)	See page 24 Non-GAAP Financial Measures.	
 
*	Calculated using income excluding net realized gains (losses) and cumulative effect of a change in accounting principle (cumulative effect)	

Financial Highlights	 	Page 1	

																			
	  	ACE Limited
Consolidated Results - Consecutive Quarters
(in millions of U.S. dollars)
(Unaudited)	
 
ACE Limited Consolidated

 	  	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	4Q-06	 	 	Full Year
2007	 	 	Full Year
2006	 	
Property and Casualty	  				 				 				 				 				 				 				
Gross premiums written	  	$	4,035	 	 	$	4,363	 	 	$	4,545	 	 	$	4,406	 	 	$	3,932	 	 	$	17,349	 	 	$	17,127	 	
Net premiums written	  	 	2,716	 	 	 	2,705	 	 	 	2,995	 	 	 	3,182	 	 	 	2,786	 	 	 	11,598	 	 	 	11,756	 	
Net premiums earned	  	 	2,959	 	 	 	3,055	 	 	 	2,921	 	 	 	2,994	 	 	 	2,948	 	 	 	11,929	 	 	 	11,551	 	
Losses and loss expenses	  	 	1,788	 	 	 	1,910	 	 	 	1,793	 	 	 	1,860	 	 	 	1,824	 	 	 	7,351	 	 	 	7,070	 	
Policy acquisition costs	  	 	448	 	 	 	450	 	 	 	422	 	 	 	406	 	 	 	424	 	 	 	1,726	 	 	 	1,689	 	
Administrative expenses	  	 	372	 	 	 	345	 	 	 	344	 	 	 	344	 	 	 	353	 	 	 	1,405	 	 	 	1,421	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
P&C underwriting income	  	$	351	 	 	$	350	 	 	$	362	 	 	$	384	 	 	$	347	 	 	$	1,447	 	 	$	1,371	 	
								
Life underwriting income excluding investment income	  	 	16	 	 	 	30	 	 	 	30	 	 	 	29	 	 	 	25	 	 	 	105	 	 	 	90	 	
Net investment income	  	 	504	 	 	 	492	 	 	 	471	 	 	 	451	 	 	 	428	 	 	 	1,918	 	 	 	1,601	 	
Net realized gains (losses)	  	 	(66	)	 	 	—  	 	 	 	(11	)	 	 	16	 	 	 	15	 	 	 	(61	)	 	 	(98	)	
Interest expense	  	 	43	 	 	 	44	 	 	 	42	 	 	 	46	 	 	 	42	 	 	 	175	 	 	 	176	 	
Other (income) expense (1)	  	 	49	 	 	 	32	 	 	 	(4	)	 	 	4	 	 	 	(16	)	 	 	81	 	 	 	(35	)	
Income tax expense (benefit)	  	 	141	 	 	 	140	 	 	 	165	 	 	 	129	 	 	 	124	 	 	 	575	 	 	 	522	 	
Cumulative effect of a change in accounting principle, net of tax	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	4	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	$	572	 	 	$	656	 	 	$	649	 	 	$	701	 	 	$	665	 	 	$	2,578	 	 	$	2,305	 	
								
Net realized gains (losses)	  	 	(66	)	 	 	—  	 	 	 	(11	)	 	 	16	 	 	 	15	 	 	 	(61	)	 	 	(98	)	
Net realized gains (losses) in other (income) expense (1)	  	 	(57	)	 	 	(38	)	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	(95	)	 	 	—  	 	
Tax expense (benefit) on net realized gains (losses)	  	 	(2	)	 	 	(2	)	 	 	4	 	 	 	(22	)	 	 	(7	)	 	 	(22	)	 	 	(48	)	
Cumulative effect of a change in accounting principle, net of tax	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	4	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) and cumulative effect (2)	  	$	693	 	 	$	692	 	 	$	664	 	 	$	663	 	 	$	643	 	 	$	2,712	 	 	$	2,351	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
% Change versus prior year period (3)	  				 				 				 				 				 				 				
Property and Casualty net premiums written	  	 	-3	%	 	 	-1	%	 	 	0	%	 	 	-2	%	 	 	9	%	 	 	-1	%	 	 	2	%	
Property and Casualty net premiums earned	  	 	0	%	 	 	1	%	 	 	3	%	 	 	9	%	 	 	6	%	 	 	3	%	 	 	0	%	
								
Other ratios	  				 				 				 				 				 				 				
Net premiums written/gross premiums written	  	 	67	%	 	 	62	%	 	 	66	%	 	 	72	%	 	 	71	%	 	 	67	%	 	 	69	%	
Effective tax rate on income excluding net realized gains (losses) and cumulative effect	  	 	17	%	 	 	17	%	 	 	20	%	 	 	19	%	 	 	17	%	 	 	18	%	 	 	20	%	
								
Combined ratio (3)	  				 				 				 				 				 				 				
Loss and loss expense ratio	  	 	60.4	%	 	 	62.5	%	 	 	61.4	%	 	 	62.1	%	 	 	61.8	%	 	 	61.6	%	 	 	61.2	%	
Policy acquisition cost ratio	  	 	15.1	%	 	 	14.7	%	 	 	14.5	%	 	 	13.5	%	 	 	14.4	%	 	 	14.5	%	 	 	14.6	%	
Administrative expense ratio	  	 	12.6	%	 	 	11.3	%	 	 	11.7	%	 	 	11.5	%	 	 	12.0	%	 	 	11.8	%	 	 	12.3	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Combined ratio	  	 	88.1	%	 	 	88.5	%	 	 	87.6	%	 	 	87.1	%	 	 	88.2	%	 	 	87.9	%	 	 	88.1	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Expense ratio P&C	  	 	27.7	%	 	 	26.0	%	 	 	26.2	%	 	 	25.0	%	 	 	26.4	%	 	 	26.3	%	 	 	26.9	%	
Expense ratio excluding A&H	  	 	24.6	%	 	 	22.8	%	 	 	23.6	%	 	 	21.9	%	 	 	23.8	%	 	 	23.2	%	 	 	24.5	%	
								
Large losses and other items (3)	  				 				 				 				 				 				 				
Catastrophe and other large losses (before tax)	  	$	23	 	 	$	21	 	 	$	81	 	 	$	34	 	 	$	6	 	 	$	159	 	 	$	17	 	
Prior period development - unfavorable (favorable)	  	$	(89	)	 	$	(70	)	 	$	(40	)	 	$	(18	)	 	$	17	 	 	$	(217	)	 	$	(12	)	
 
(1)	Includes $57 million and $38 million of net realized investment and derivative losses related to our unconsolidated insurance affiliates for quarter 4 2007 and quarter 3 2007, respectively.	
 
(2)	See page 24 Non-GAAP Financial Measures.	
 
(3)	Property and casualty excluding Life is presented to allow for comparison and analysis with earnings guidance. This is a non-GAAP measure.	

Consolidated Results	 	Page 2	

			
	  	ACE Limited
 
Summary Consolidated Balance Sheets
 
(in millions of U.S. dollars, except per share data)	

																
 	  	December 31
2007	  	September 30
2007	  	June 30
2007	  	March 31
2007	  	December 31
2006	
 	  	(Unaudited)	  	(Unaudited)	  	(Unaudited)	  	(Unaudited)	  	(Audited)	
Assets	  			  			  			  			  			
Fixed maturities available for sale, at fair value	  	$	33,184	  	$	32,632	  	$	30,591	  	$	29,934	  	$	28,540	
Fixed maturities held to maturity, at amortized cost	  	 	2,987	  	 	2,979	  	 	3,013	  	 	3,060	  	 	3,047	
Equity securities, at fair value	  	 	1,837	  	 	1,866	  	 	1,896	  	 	1,772	  	 	1,713	
Short-term investments, at fair value	  	 	2,631	  	 	2,940	  	 	2,919	  	 	2,658	  	 	2,456	
Other investments	  	 	1,140	  	 	1,050	  	 	934	  	 	896	  	 	845	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total investments	  	 	41,779	  	 	41,467	  	 	39,353	  	 	38,320	  	 	36,601	
						
Cash	  	 	510	  	 	506	  	 	621	  	 	639	  	 	565	
Securities lending collateral	  	 	2,109	  	 	2,301	  	 	2,811	  	 	2,905	  	 	2,171	
Insurance and reinsurance balances receivable	  	 	3,540	  	 	3,324	  	 	3,923	  	 	3,689	  	 	3,580	
Reinsurance recoverable	  	 	14,362	  	 	14,218	  	 	14,081	  	 	14,374	  	 	14,580	
Deferred policy acquisition costs	  	 	1,121	  	 	1,138	  	 	1,160	  	 	1,133	  	 	1,077	
Prepaid reinsurance premiums	  	 	1,600	  	 	1,687	  	 	1,854	  	 	1,621	  	 	1,586	
Goodwill	  	 	2,731	  	 	2,731	  	 	2,731	  	 	2,731	  	 	2,731	
Deferred tax assets	  	 	1,087	  	 	1,163	  	 	1,163	  	 	1,192	  	 	1,165	
Investments in partially owned insurance companies	  	 	773	  	 	786	  	 	826	  	 	804	  	 	789	
Other assets	  	 	2,478	  	 	2,633	  	 	2,497	  	 	2,366	  	 	2,290	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total assets	  	$	72,090	  	$	71,954	  	$	71,020	  	$	69,774	  	$	67,135	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Liabilities	  			  			  			  			  			
Unpaid losses and loss expenses	  	$	37,112	  	$	36,868	  	$	36,123	  	$	35,813	  	$	35,517	
Unearned premiums	  	 	6,227	  	 	6,542	  	 	7,001	  	 	6,670	  	 	6,437	
Future policy benefits for life and annuity contracts	  	 	545	  	 	527	  	 	521	  	 	521	  	 	518	
Insurance and reinsurance balances payable	  	 	2,843	  	 	2,592	  	 	2,690	  	 	2,511	  	 	2,449	
Deposit liabilities	  	 	351	  	 	355	  	 	363	  	 	327	  	 	335	
Securities lending payable	  	 	2,109	  	 	2,301	  	 	2,811	  	 	2,905	  	 	2,171	
Payable for securities purchased	  	 	1,798	  	 	2,407	  	 	2,257	  	 	1,338	  	 	1,286	
Accounts payable, accrued expenses and other liabilities	  	 	1,825	  	 	1,689	  	 	1,445	  	 	1,514	  	 	1,541	
Income taxes payable	  	 	111	  	 	174	  	 	168	  	 	265	  	 	156	
Short-term debt	  	 	372	  	 	87	  	 	85	  	 	581	  	 	578	
Long-term debt	  	 	1,811	  	 	2,068	  	 	2,063	  	 	2,061	  	 	1,560	
Trust preferred securities	  	 	309	  	 	309	  	 	309	  	 	309	  	 	309	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total liabilities	  	 	55,413	  	 	55,919	  	 	55,836	  	 	54,815	  	 	52,857	
						
Shareholders’ equity	  			  			  			  			  			
Total shareholders’ equity, excl. AOCI	  	 	15,908	  	 	15,379	  	 	14,781	  	 	14,181	  	 	13,562	
Accumulated other comprehensive income (AOCI)	  	 	769	  	 	656	  	 	403	  	 	778	  	 	716	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total shareholders’ equity	  	 	16,677	  	 	16,035	  	 	15,184	  	 	14,959	  	 	14,278	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total liabilities and shareholders’ equity	  	$	72,090	  	$	71,954	  	$	71,020	  	$	69,774	  	$	67,135	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Book value per ordinary share (1)	  	$	48.89	  	$	46.98	  	$	44.46	  	$	43.87	  	$	42.03	
Tangible book value per ordinary share (1)	  	$	40.61	  	$	38.69	  	$	36.16	  	$	35.55	  	$	33.66	
 
(1)	See page 24 Non-GAAP Financial Measures.	

Consol Bal Sheet	 	Page 3	

																							
	  	ACE Limited
Consolidated Premiums by Line of Business
(in millions of U.S. dollars)
(Unaudited)	
 
ACE Limited Consolidated

 	  	4Q-07	  	% of
Total
Consolidated	 	 	4Q-06	  	% of
Total
Consolidated	 	 	% Change
4Q-07 vs.
4Q-06	 	 	Year
2007	  	% of
Total
Consolidated	 	 	Year
2006	  	% of
Total
Consolidated	 	 	% Change
2007 vs.
2006	 	
Net premiums written	  			  			 			  			 			 			  			 			  			 			
Property and all other	  	$	765	  	27	%	 	$	734	  	25	%	 	4	%	 	$	3,702	  	31	%	 	$	3,677	  	31	%	 	1	%	
Casualty	  	 	1,522	  	54	%	 	 	1,687	  	59	%	 	-10	%	 	 	6,219	  	52	%	 	 	6,652	  	55	%	 	-7	%	
Personal accident (A&H)	  	 	429	  	15	%	 	 	365	  	13	%	 	18	%	 	 	1,677	  	14	%	 	 	1,427	  	12	%	 	18	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Total P&C	  	 	2,716	  	96	%	 	 	2,786	  	97	%	 	-3	%	 	 	11,598	  	97	%	 	 	11,756	  	98	%	 	-1	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Life	  	 	111	  	4	%	 	 	78	  	3	%	 	42	%	 	 	381	  	3	%	 	 	274	  	2	%	 	39	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Total Consolidated	  	$	2,827	  	100	%	 	$	2,864	  	100	%	 	-1	%	 	$	11,979	  	100	%	 	$	12,030	  	100	%	 	0	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Net premiums earned	  			  			 			  			 			 			  			 			  			 			
Property and all other	  	$	957	  	31	%	 	$	924	  	31	%	 	4	%	 	$	3,787	  	31	%	 	$	3,618	  	31	%	 	5	%	
Casualty	  	 	1,556	  	51	%	 	 	1,646	  	54	%	 	-5	%	 	 	6,464	  	52	%	 	 	6,506	  	55	%	 	-1	%	
Personal accident (A&H)	  	 	446	  	15	%	 	 	378	  	12	%	 	18	%	 	 	1,678	  	14	%	 	 	1,427	  	12	%	 	18	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Total P&C	  	 	2,959	  	97	%	 	 	2,948	  	97	%	 	0	%	 	 	11,929	  	97	%	 	 	11,551	  	98	%	 	3	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Life	  	 	98	  	3	%	 	 	78	  	3	%	 	26	%	 	 	368	  	3	%	 	 	274	  	2	%	 	34	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Total Consolidated	  	$	3,057	  	100	%	 	$	3,026	  	100	%	 	1	%	 	$	12,297	  	100	%	 	$	11,825	  	100	%	 	4	%	

			
Line of Business	 	Page 4	

			
	  	ACE Limited
Consolidating Statement of Operations
Three months ended December 31, 2007 and 2006
(in millions of U.S. dollars)
(Unaudited)	

	  		

																													
 	  	Insurance -
North
American	 	 	Insurance -
Overseas
General	 	 	Global
Reinsurance	 	 	Corporate
& Other	 	 	Consolidated
P&C	 	 	Life Insurance
& Reinsurance	 	 	ACE
Consolidated	 	

December 31, 2007	  				 				 				 				 				 				 				
Gross premiums written	  	$	2,274	 	 	$	1,584	 	 	$	177	 	 	$	—  	 	 	$	4,035	 	 	$	109	 	 	$	4,144	 	
Net premiums written	  	 	1,373	 	 	 	1,169	 	 	 	174	 	 	 	—  	 	 	 	2,716	 	 	 	111	 	 	 	2,827	 	
Net premiums earned	  	 	1,418	 	 	 	1,229	 	 	 	312	 	 	 	—  	 	 	 	2,959	 	 	 	98	 	 	 	3,057	 	
Losses and loss expenses	  	 	1,004	 	 	 	631	 	 	 	155	 	 	 	(2	)	 	 	1,788	 	 	 	—  	 	 	 	1,788	 	
Life and annuity benefits	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	60	 	 	 	60	 	
Policy acquisition costs	  	 	121	 	 	 	269	 	 	 	58	 	 	 	—  	 	 	 	448	 	 	 	9	 	 	 	457	 	
Administrative expenses	  	 	138	 	 	 	175	 	 	 	17	 	 	 	42	 	 	 	372	 	 	 	13	 	 	 	385	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (loss)	  	 	155	 	 	 	154	 	 	 	82	 	 	 	(40	)	 	 	351	 	 	 	16	 	 	 	367	 	
								
Net investment income	  	 	276	 	 	 	119	 	 	 	73	 	 	 	21	 	 	 	489	 	 	 	15	 	 	 	504	 	
Net realized gains (losses)	  	 	44	 	 	 	(11	)	 	 	(3	)	 	 	12	 	 	 	42	 	 	 	(108	)	 	 	(66	)	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	43	 	 	 	43	 	 	 	—  	 	 	 	43	 	
Other (income) expense	  	 	—  	 	 	 	(12	)	 	 	1	 	 	 	59	 	 	 	48	 	 	 	1	 	 	 	49	 	
Income tax expense (benefit)	  	 	100	 	 	 	59	 	 	 	7	 	 	 	(21	)	 	 	145	 	 	 	(4	)	 	 	141	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income (loss)	  	 	375	 	 	 	215	 	 	 	144	 	 	 	(88	)	 	 	646	 	 	 	(74	)	 	 	572	 	
								
Net realized gains (losses)	  	 	44	 	 	 	(11	)	 	 	(3	)	 	 	12	 	 	 	42	 	 	 	(108	)	 	 	(66	)	
Net realized gains (losses) in other (income) expense	  	 	—  	 	 	 	15	 	 	 	—  	 	 	 	(73	)	 	 	(58	)	 	 	1	 	 	 	(57	)	
Tax expense (benefit) on net realized gains (losses)	  	 	(2	)	 	 	(1	)	 	 	(1	)	 	 	2	 	 	 	(2	)	 	 	—  	 	 	 	(2	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income (loss) excluding net realized gains (losses) (1)	  	$	329	 	 	$	210	 	 	$	146	 	 	$	(25	)	 	$	660	 	 	$	33	 	 	$	693	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
December 31, 2006	  				 				 				 				 				 				 				
Gross premiums written	  	$	2,236	 	 	$	1,441	 	 	$	255	 	 	$	—  	 	 	$	3,932	 	 	$	78	 	 	$	4,010	 	
Net premiums written	  	 	1,476	 	 	 	1,059	 	 	 	251	 	 	 	—  	 	 	 	2,786	 	 	 	78	 	 	 	2,864	 	
Net premiums earned	  	 	1,471	 	 	 	1,097	 	 	 	380	 	 	 	—  	 	 	 	2,948	 	 	 	78	 	 	 	3,026	 	
Losses and loss expenses	  	 	1,054	 	 	 	576	 	 	 	194	 	 	 	—  	 	 	 	1,824	 	 	 	—  	 	 	 	1,824	 	
Life and annuity benefits	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	32	 	 	 	32	 	
Policy acquisition costs	  	 	122	 	 	 	226	 	 	 	76	 	 	 	—  	 	 	 	424	 	 	 	9	 	 	 	433	 	
Administrative expenses	  	 	132	 	 	 	157	 	 	 	14	 	 	 	50	 	 	 	353	 	 	 	12	 	 	 	365	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (loss)	  	 	163	 	 	 	138	 	 	 	96	 	 	 	(50	)	 	 	347	 	 	 	25	 	 	 	372	 	
								
Net investment income	  	 	233	 	 	 	97	 	 	 	62	 	 	 	24	 	 	 	416	 	 	 	12	 	 	 	428	 	
Net realized gains (losses)	  	 	(11	)	 	 	8	 	 	 	17	 	 	 	14	 	 	 	28	 	 	 	(13	)	 	 	15	 	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	42	 	 	 	42	 	 	 	—  	 	 	 	42	 	
Other (income) expense	  	 	(13	)	 	 	7	 	 	 	2	 	 	 	(12	)	 	 	(16	)	 	 	—  	 	 	 	(16	)	
Income tax expense (benefit)	  	 	89	 	 	 	43	 	 	 	9	 	 	 	(12	)	 	 	129	 	 	 	(5	)	 	 	124	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income (loss)	  	 	309	 	 	 	193	 	 	 	164	 	 	 	(30	)	 	 	636	 	 	 	29	 	 	 	665	 	
								
Net realized gains (losses)	  	 	(11	)	 	 	8	 	 	 	17	 	 	 	14	 	 	 	28	 	 	 	(13	)	 	 	15	 	
Tax expense (benefit) on net realized gains (losses)	  	 	(16	)	 	 	2	 	 	 	1	 	 	 	6	 	 	 	(7	)	 	 	—  	 	 	 	(7	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income (loss) excluding net realized gains (losses) (1)	  	$	304	 	 	$	187	 	 	$	148	 	 	$	(38	)	 	$	601	 	 	$	42	 	 	$	643	 	

(1)	See page 24 Non-GAAP Financial Measures.	

Segment 2007 Qtr	 	Page 5	

			
	  	ACE Limited
Consolidating Statement of Operations
Year ended December 31, 2007 and 2006
(in millions of U.S. dollars)
(Unaudited)	

 	  	Insurance -
North
American	 	 	Insurance -
Overseas
General	 	 	Global
Reinsurance	 	 	Corporate
& Other	 	 	Consolidated
P&C	 	 	Life Insurance
& Reinsurance	 	 	ACE
Consolidated	 	
December 31, 2007	  				 				 				 				 				 				 				
Gross premiums written	  	$	9,840	 	 	$	6,291	 	 	$	1,218	 	 	$	—  	 	 	$	17,349	 	 	$	391	 	 	$	17,740	 	
Net premiums written	  	 	5,833	 	 	 	4,568	 	 	 	1,197	 	 	 	—  	 	 	 	11,598	 	 	 	381	 	 	 	11,979	 	
Net premiums earned	  	 	6,007	 	 	 	4,623	 	 	 	1,299	 	 	 	—  	 	 	 	11,929	 	 	 	368	 	 	 	12,297	 	
Losses and loss expenses	  	 	4,269	 	 	 	2,420	 	 	 	664	 	 	 	(2	)	 	 	7,351	 	 	 	—  	 	 	 	7,351	 	
Life and annuity benefits	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	168	 	 	 	168	 	
Policy acquisition costs	  	 	515	 	 	 	963	 	 	 	248	 	 	 	—  	 	 	 	1,726	 	 	 	45	 	 	 	1,771	 	
Administrative expenses	  	 	530	 	 	 	669	 	 	 	64	 	 	 	142	 	 	 	1,405	 	 	 	50	 	 	 	1,455	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (loss)	  	 	693	 	 	 	571	 	 	 	323	 	 	 	(140	)	 	 	1,447	 	 	 	105	 	 	 	1,552	 	
								
Net investment income	  	 	1,034	 	 	 	450	 	 	 	274	 	 	 	105	 	 	 	1,863	 	 	 	55	 	 	 	1,918	 	
Net realized gains (losses)	  	 	125	 	 	 	(69	)	 	 	21	 	 	 	26	 	 	 	103	 	 	 	(164	)	 	 	(61	)	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	175	 	 	 	175	 	 	 	—  	 	 	 	175	 	
Other (income) expense	  	 	11	 	 	 	(20	)	 	 	4	 	 	 	85	 	 	 	80	 	 	 	1	 	 	 	81	 	
Income tax expense (benefit)	  	 	468	 	 	 	183	 	 	 	32	 	 	 	(100	)	 	 	583	 	 	 	(8	)	 	 	575	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income (loss)	  	 	1,373	 	 	 	789	 	 	 	582	 	 	 	(169	)	 	 	2,575	 	 	 	3	 	 	 	2,578	 	
								
Net realized gains (losses)	  	 	125	 	 	 	(69	)	 	 	21	 	 	 	26	 	 	 	103	 	 	 	(164	)	 	 	(61	)	
Net realized gains (losses) in other (income) expense	  	 	—  	 	 	 	26	 	 	 	—  	 	 	 	(122	)	 	 	(96	)	 	 	1	 	 	 	(95	)	
Tax expense (benefit) on net realized gains (losses)	  	 	21	 	 	 	(14	)	 	 	(2	)	 	 	(27	)	 	 	(22	)	 	 	—  	 	 	 	(22	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income (loss) excluding net realized gains (losses) (1)	  	$	1,269	 	 	$	818	 	 	$	559	 	 	$	(100	)	 	$	2,546	 	 	$	166	 	 	$	2,712	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
December 31, 2006	  				 				 				 				 				 				 				
Gross premiums written	  	$	9,663	 	 	$	5,897	 	 	$	1,567	 	 	$	—  	 	 	$	17,127	 	 	$	274	 	 	$	17,401	 	
Net premiums written	  	 	5,940	 	 	 	4,266	 	 	 	1,550	 	 	 	—  	 	 	 	11,756	 	 	 	274	 	 	 	12,030	 	
Net premiums earned	  	 	5,719	 	 	 	4,321	 	 	 	1,511	 	 	 	—  	 	 	 	11,551	 	 	 	274	 	 	 	11,825	 	
Losses and loss expenses	  	 	4,026	 	 	 	2,259	 	 	 	784	 	 	 	1	 	 	 	7,070	 	 	 	—  	 	 	 	7,070	 	
Life and annuity benefits	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	123	 	 	 	123	 	
Policy acquisition costs	  	 	530	 	 	 	856	 	 	 	303	 	 	 	—  	 	 	 	1,689	 	 	 	26	 	 	 	1,715	 	
Administrative expenses	  	 	502	 	 	 	609	 	 	 	62	 	 	 	248	 	 	 	1,421	 	 	 	35	 	 	 	1,456	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (loss)	  	 	661	 	 	 	597	 	 	 	362	 	 	 	(249	)	 	 	1,371	 	 	 	90	 	 	 	1,461	 	
								
Net investment income	  	 	876	 	 	 	370	 	 	 	221	 	 	 	92	 	 	 	1,559	 	 	 	42	 	 	 	1,601	 	
Net realized gains (losses)	  	 	(83	)	 	 	(16	)	 	 	10	 	 	 	27	 	 	 	(62	)	 	 	(36	)	 	 	(98	)	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	176	 	 	 	176	 	 	 	—  	 	 	 	176	 	
Other (income) expense	  	 	(2	)	 	 	10	 	 	 	8	 	 	 	(51	)	 	 	(35	)	 	 	—  	 	 	 	(35	)	
Income tax expense (benefit)	  	 	352	 	 	 	206	 	 	 	38	 	 	 	(68	)	 	 	528	 	 	 	(6	)	 	 	522	 	
Cumulative effect of a change in accounting principle, net of tax	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	4	 	 	 	4	 	 	 	—  	 	 	 	4	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income (loss)	  	 	1,104	 	 	 	735	 	 	 	547	 	 	 	(183	)	 	 	2,203	 	 	 	102	 	 	 	2,305	 	
								
Net realized gains (losses)	  	 	(83	)	 	 	(16	)	 	 	10	 	 	 	27	 	 	 	(62	)	 	 	(36	)	 	 	(98	)	
Tax expense (benefit) on net realized gains (losses)	  	 	(55	)	 	 	3	 	 	 	(1	)	 	 	5	 	 	 	(48	)	 	 	—  	 	 	 	(48	)	
Cumulative effect of a change in accounting principle, net of tax	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	4	 	 	 	4	 	 	 	—  	 	 	 	4	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income (loss) excluding net realized gains (losses) (1)	  	$	1,132	 	 	$	754	 	 	$	536	 	 	$	(209	)	 	$	2,213	 	 	$	138	 	 	$	2,351	 	

(1)	See page 24 Non-GAAP Financial Measures.	

Segment 2007 YTD	 	Page 6	

			
	  	ACE Limited
Consolidated Results—Financial Institutions Portfolio—U.S. Exposed
(in millions of U.S. dollars)
(Unaudited)	

	  		

												
 	  	Net
Premiums
Written	  	Average
Net
Limit	 	 	Average
Attachment	 	
Directors and Officers (D&O)	  			  				 				
A-Side	  	$	25.3	  	$	13.7	 	 	$	102.1	 	
ABC	  	 	68.9	  	 	6.2	 	 	 	43.4	 	
	  	 	 	  	 	 	 	 	 	 	 	
	  	$	94.2	  	$	7.7	 	 	$	55.3	 	
Errors and Omissions (E&O)	  			  				 				
Bankers Professional	  	$	8.5	  	$	4.6	 	 	$	19.4	 	
Insurance Companies	  	 	16.1	  	 	5.7	 	 	 	15.0	 	
Investment Management	  	 	10.1	  	 	5.2	 	 	 	28.5	 	
Rating Agencies	  	 	1.1	  	 	5.4	 	 	 	25.4	 	
Mortgage Bankers / Brokers	  	 	4.2	  	 	0.5	 	 	 	0.0	 	
Broker/Dealers	  	 	9.2	  	 	1.1	 	 	 	12.9	 	
	  	 	 	  	 	 	 	 	 	 	 	
	  	$	49.2	  	$	3.2	 	 	$	17.1	 	

                Total	  	$	143.4	  	$	5.8	*	 	$	39.0	*	

Additional Facts:
1.	U.S. Exposed D&O includes International Companies with U.S. Securities and Exchange Commission (SEC) / American Depository Receipts (ADR) exposure.	
2.	D&O includes Capital Markets, Commercial Banks, Consumer Finance, Diversified Financials, Insurance, REITS, Thrifts&Mortgage, Rating Agencies	
3.	All premium is net of treaty reinsurance. Net to gross ratio is 76.4% for U.S. exposed business.	
4.	All coverage is claims made.	
5.	Defense costs are included within policy limits.	
 
* Excludes Mortgage Bankers/Brokers

Financial Institutions	 	Page 7	

			
	  	ACE Limited
Segment Results - Consecutive Quarters
(in millions of U.S. dollars)
(Unaudited)	

	  		
Insurance - North American

 	  	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	4Q-06	 	 	Full Year
2007	 	 	Full Year
2006	 	
Gross premiums written	  	$	2,274	 	 	$	2,708	 	 	$	2,589	 	 	$	2,269	 	 	$	2,236	 	 	$	9,840	 	 	$	9,663	 	
Net premiums written	  	 	1,373	 	 	 	1,449	 	 	 	1,497	 	 	 	1,514	 	 	 	1,476	 	 	 	5,833	 	 	 	5,940	 	
Net premiums earned	  	 	1,418	 	 	 	1,595	 	 	 	1,455	 	 	 	1,539	 	 	 	1,471	 	 	 	6,007	 	 	 	5,719	 	
Losses and loss expenses	  	 	1,004	 	 	 	1,138	 	 	 	1,016	 	 	 	1,111	 	 	 	1,054	 	 	 	4,269	 	 	 	4,026	 	
Policy acquisition costs	  	 	121	 	 	 	150	 	 	 	128	 	 	 	116	 	 	 	122	 	 	 	515	 	 	 	530	 	
Administrative expenses	  	 	138	 	 	 	129	 	 	 	130	 	 	 	133	 	 	 	132	 	 	 	530	 	 	 	502	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income	  	 	155	 	 	 	178	 	 	 	181	 	 	 	179	 	 	 	163	 	 	 	693	 	 	 	661	 	
								
Net investment income	  	 	276	 	 	 	260	 	 	 	257	 	 	 	241	 	 	 	233	 	 	 	1,034	 	 	 	876	 	
Net realized gains (losses)	  	 	44	 	 	 	29	 	 	 	15	 	 	 	37	 	 	 	(11	)	 	 	125	 	 	 	(83	)	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	
Other (income) expense	  	 	—  	 	 	 	1	 	 	 	1	 	 	 	9	 	 	 	(13	)	 	 	11	 	 	 	(2	)	
Income tax expense (benefit)	  	 	100	 	 	 	125	 	 	 	115	 	 	 	128	 	 	 	89	 	 	 	468	 	 	 	352	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	 	375	 	 	 	341	 	 	 	337	 	 	 	320	 	 	 	309	 	 	 	1,373	 	 	 	1,104	 	
								
Net realized gains (losses)	  	 	44	 	 	 	29	 	 	 	15	 	 	 	37	 	 	 	(11	)	 	 	125	 	 	 	(83	)	
Tax expense (benefit) on net realized gains (losses)	  	 	(2	)	 	 	—  	 	 	 	8	 	 	 	15	 	 	 	(16	)	 	 	21	 	 	 	(55	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) (1)	  	$	329	 	 	$	312	 	 	$	330	 	 	$	298	 	 	$	304	 	 	$	1,269	 	 	$	1,132	 	

Combined ratio	  				 				 				 				 				 				 				
Loss and loss expense ratio	  	 	70.8	%	 	 	71.3	%	 	 	69.8	%	 	 	72.2	%	 	 	71.7	%	 	 	71.1	%	 	 	70.4	%	
Policy acquisition cost ratio	  	 	8.6	%	 	 	9.4	%	 	 	8.8	%	 	 	7.5	%	 	 	8.3	%	 	 	8.6	%	 	 	9.2	%	
Administrative expense ratio	  	 	9.7	%	 	 	8.1	%	 	 	8.9	%	 	 	8.7	%	 	 	8.9	%	 	 	8.8	%	 	 	8.8	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Combined ratio	  	 	89.1	%	 	 	88.8	%	 	 	87.5	%	 	 	88.4	%	 	 	88.9	%	 	 	88.5	%	 	 	88.4	%	

Large losses and other items (before tax)	  				 				 				 				 				 				 				
Catastrophe and other large losses (before tax)	  	$	—  	 	 	$	—  	 	 	$	16	 	 	$	—  	 	 	$	—  	 	 	$	16	 	 	$	—  	 	
Prior period development - unfavorable (favorable)	  	$	1	 	 	$	4	 	 	$	(6	)	 	$	10	 	 	$	20	 	 	$	9	 	 	$	65	 	
								
% Change versus prior year period	  				 				 				 				 				 				 				
Net premiums written	  	 	-7	%	 	 	-1	%	 	 	0	%	 	 	1	%	 	 	16	%	 	 	-2	%	 	 	2	%	
Net premiums earned	  	 	-4	%	 	 	3	%	 	 	6	%	 	 	15	%	 	 	9	%	 	 	5	%	 	 	0	%	
								
Other ratios	  				 				 				 				 				 				 				
Net premiums written/gross premiums written	  	 	60	%	 	 	54	%	 	 	58	%	 	 	67	%	 	 	66	%	 	 	59	%	 	 	61	%	
 
(1)	See page 24 Non-GAAP Financial Measures.	

Insurance-North American	 	Page 8	

			
	  	ACE Limited
Segment Results - Consecutive Quarters
(in millions of U.S. dollars)
(Unaudited)	

	  		
 
Insurance - Overseas General

   	  	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	4Q-06	 	 	Full Year
2007	 	 	Full Year
2006	 	
Gross premiums written	  	$	1,584	 	 	$	1,427	 	 	$	1,621	 	 	$	1,659	 	 	$	1,441	 	 	$	6,291	 	 	$	5,897	 	
Net premiums written	  	 	1,169	 	 	 	1,041	 	 	 	1,166	 	 	 	1,192	 	 	 	1,059	 	 	 	4,568	 	 	 	4,266	 	
Net premiums earned	  	 	1,229	 	 	 	1,141	 	 	 	1,141	 	 	 	1,112	 	 	 	1,097	 	 	 	4,623	 	 	 	4,321	 	
Losses and loss expenses	  	 	631	 	 	 	611	 	 	 	614	 	 	 	564	 	 	 	576	 	 	 	2,420	 	 	 	2,259	 	
Policy acquisition costs	  	 	269	 	 	 	240	 	 	 	230	 	 	 	224	 	 	 	226	 	 	 	963	 	 	 	856	 	
Administrative expenses	  	 	175	 	 	 	170	 	 	 	162	 	 	 	162	 	 	 	157	 	 	 	669	 	 	 	609	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income	  	 	154	 	 	 	120	 	 	 	135	 	 	 	162	 	 	 	138	 	 	 	571	 	 	 	597	 	
								
Net investment income	  	 	119	 	 	 	116	 	 	 	111	 	 	 	104	 	 	 	97	 	 	 	450	 	 	 	370	 	
Net realized gains (losses)	  	 	(11	)	 	 	(5	)	 	 	(27	)	 	 	(26	)	 	 	8	 	 	 	(69	)	 	 	(16	)	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	
Other (income) expense	  	 	(12	)	 	 	(12	)	 	 	1	 	 	 	3	 	 	 	7	 	 	 	(20	)	 	 	10	 	
Income tax expense (benefit)	  	 	59	 	 	 	26	 	 	 	58	 	 	 	40	 	 	 	43	 	 	 	183	 	 	 	206	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	 	215	 	 	 	217	 	 	 	160	 	 	 	197	 	 	 	193	 	 	 	789	 	 	 	735	 	
								
Net realized gains (losses)	  	 	(11	)	 	 	(5	)	 	 	(27	)	 	 	(26	)	 	 	8	 	 	 	(69	)	 	 	(16	)	
Net realized gains (losses) in other (income) expense	  	 	15	 	 	 	11	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	26	 	 	 	—  	 	
Tax expense (benefit) on net realized gains (losses)	  	 	(1	)	 	 	(1	)	 	 	(4	)	 	 	(8	)	 	 	2	 	 	 	(14	)	 	 	3	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) (1)	  	$	210	 	 	$	210	 	 	$	183	 	 	$	215	 	 	$	187	 	 	$	818	 	 	$	754	 	

Combined ratio	  				 				 				 				 				 				 				
Loss and loss expense ratio	  	 	51.4	%	 	 	53.6	%	 	 	53.9	%	 	 	50.7	%	 	 	52.5	%	 	 	52.4	%	 	 	52.3	%	
Policy acquisition cost ratio	  	 	21.8	%	 	 	21.1	%	 	 	20.1	%	 	 	20.2	%	 	 	20.6	%	 	 	20.8	%	 	 	19.8	%	
Administrative expense ratio	  	 	14.3	%	 	 	14.8	%	 	 	14.2	%	 	 	14.5	%	 	 	14.3	%	 	 	14.5	%	 	 	14.1	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Combined ratio	  	 	87.5	%	 	 	89.5	%	 	 	88.2	%	 	 	85.4	%	 	 	87.4	%	 	 	87.7	%	 	 	86.2	%	

Large losses and other items	  				 				 				 				 				 				 				
Catastrophe and other large losses (before tax)	  	$	13	 	 	$	8	 	 	$	58	 	 	$	15	 	 	$	—  	 	 	 	94	 	 	$	3	 	
Prior period development - unfavorable (favorable)	  	$	(76	)	 	$	(64	)	 	$	(31	)	 	$	(21	)	 	$	4	 	 	 	(192	)	 	$	(72	)	
								
% Change versus prior year period	  				 				 				 				 				 				 				
Net premiums written	  	 	10	%	 	 	6	%	 	 	8	%	 	 	4	%	 	 	4	%	 	 	7	%	 	 	2	%	
Net premiums earned	  	 	12	%	 	 	4	%	 	 	5	%	 	 	7	%	 	 	5	%	 	 	7	%	 	 	2	%	
								
Other ratios	  				 				 				 				 				 				 				
Net premiums written/gross premiums written	  	 	74	%	 	 	73	%	 	 	72	%	 	 	72	%	 	 	73	%	 	 	73	%	 	 	72	%	
 
(1)	See page 24 Non-GAAP Financial Measures.	

Insurance-Overseas General	 	Page 9	

			
	  	ACE Limited
Segment Results - Consecutive Quarters
(in millions of U.S. dollars)
(Unaudited)	

	  		
 
Global Reinsurance

   	  	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	4Q-06	 	 	Full Year
2007	 	 	Full Year
2006	 	
Gross premiums written	  	$	177	 	 	$	228	 	 	$	335	 	 	$	478	 	 	$	255	 	 	$	1,218	 	 	$	1,567	 	
Net premiums written	  	 	174	 	 	 	215	 	 	 	332	 	 	 	476	 	 	 	251	 	 	 	1,197	 	 	 	1,550	 	
Net premiums earned	  	 	312	 	 	 	319	 	 	 	325	 	 	 	343	 	 	 	380	 	 	 	1,299	 	 	 	1,511	 	
Losses and loss expenses	  	 	155	 	 	 	161	 	 	 	163	 	 	 	185	 	 	 	194	 	 	 	664	 	 	 	784	 	
Policy acquisition costs	  	 	58	 	 	 	60	 	 	 	64	 	 	 	66	 	 	 	76	 	 	 	248	 	 	 	303	 	
Administrative expenses	  	 	17	 	 	 	14	 	 	 	16	 	 	 	17	 	 	 	14	 	 	 	64	 	 	 	62	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income	  	 	82	 	 	 	84	 	 	 	82	 	 	 	75	 	 	 	96	 	 	 	323	 	 	 	362	 	
								
Net investment income	  	 	73	 	 	 	69	 	 	 	66	 	 	 	66	 	 	 	62	 	 	 	274	 	 	 	221	 	
Net realized gains (losses)	  	 	(3	)	 	 	25	 	 	 	(7	)	 	 	6	 	 	 	17	 	 	 	21	 	 	 	10	 	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	
Other (income) expense	  	 	1	 	 	 	—  	 	 	 	2	 	 	 	1	 	 	 	2	 	 	 	4	 	 	 	8	 	
Income tax expense (benefit)	  	 	7	 	 	 	11	 	 	 	7	 	 	 	7	 	 	 	9	 	 	 	32	 	 	 	38	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	 	144	 	 	 	167	 	 	 	132	 	 	 	139	 	 	 	164	 	 	 	582	 	 	 	547	 	
								
Net realized gains (losses)	  	 	(3	)	 	 	25	 	 	 	(7	)	 	 	6	 	 	 	17	 	 	 	21	 	 	 	10	 	
Tax expense (benefit) on net realized gains (losses)	  	 	(1	)	 	 	—  	 	 	 	—  	 	 	 	(1	)	 	 	1	 	 	 	(2	)	 	 	(1	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) (1)	  	$	146	 	 	$	142	 	 	$	139	 	 	$	132	 	 	$	148	 	 	$	559	 	 	$	536	 	

Combined ratio	  				 				 				 				 				 				 				
Loss and loss expense ratio	  	 	49.8	%	 	 	50.6	%	 	 	50.1	%	 	 	53.8	%	 	 	50.9	%	 	 	51.1	%	 	 	51.8	%	
Policy acquisition cost ratio	  	 	18.3	%	 	 	18.8	%	 	 	19.9	%	 	 	19.2	%	 	 	20.1	%	 	 	19.1	%	 	 	20.1	%	
Administrative expense ratio	  	 	5.5	%	 	 	4.2	%	 	 	5.0	%	 	 	5.0	%	 	 	3.7	%	 	 	4.9	%	 	 	4.1	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Combined ratio	  	 	73.6	%	 	 	73.6	%	 	 	75.0	%	 	 	78.0	%	 	 	74.7	%	 	 	75.1	%	 	 	76.0	%	

Large losses and other items	  				 				 				 				 				 				 				
Catastrophe and other large losses (before tax)	  	$	10	 	 	$	13	 	 	$	7	 	 	$	19	 	 	$	6	 	 	 	49	 	 	$	14	 	
Prior period development - unfavorable (favorable)	  	$	(14	)	 	$	(10	)	 	$	(3	)	 	$	(7	)	 	$	(7	)	 	 	(34	)	 	$	(5	)	
 
(1)	See page 24 Non-GAAP Financial Measures.	

Global Reinsurance	 	Page 10	

			
	  	ACE Limited
Segment Results - Consecutive Quarters - 2
(in millions of U.S. dollars)
(Unaudited)	

	  		
 
Global Reinsurance

   	  	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	4Q-06	 	 	Full Year
2007	 	 	Full Year
2006	 	
% Change versus prior year period	  				 				 				 				 				 				 				
Net premiums written	  	 	-31	%	 	 	-24	%	 	 	-20	%	 	 	-21	%	 	 	-9	%	 	 	-23	%	 	 	0	%	
Net premiums earned	  	 	-18	%	 	 	-14	%	 	 	-16	%	 	 	-8	%	 	 	-4	%	 	 	-14	%	 	 	-1	%	
								
Other ratios	  				 				 				 				 				 				 				
Net premiums written/gross premiums written	  	 	98	%	 	 	94	%	 	 	99	%	 	 	100	%	 	 	98	%	 	 	98	%	 	 	99	%	
								
Global Reinsurance - By Division	  				 				 				 				 				 				 				
 	  	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	4Q-06	 	 	Full Year
2007	 	 	Full Year
2006	 	
Gross premiums written	  				 				 				 				 				 				 				
ACE Tempest Re Bermuda	  	$	14	 	 	$	51	 	 	$	121	 	 	$	174	 	 	$	16	 	 	$	360	 	 	$	386	 	
ACE Tempest Re USA	  	 	118	 	 	 	134	 	 	 	175	 	 	 	188	 	 	 	181	 	 	 	615	 	 	 	903	 	
ACE Tempest Re Europe	  	 	42	 	 	 	39	 	 	 	35	 	 	 	112	 	 	 	58	 	 	 	228	 	 	 	278	 	
ACE Tempest Re Canada	  	 	3	 	 	 	4	 	 	 	4	 	 	 	4	 	 	 	—  	 	 	 	15	 	 	 	—  	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	177	 	 	$	228	 	 	$	335	 	 	$	478	 	 	$	255	 	 	$	1,218	 	 	$	1,567	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net premiums written	  				 				 				 				 				 				 				
ACE Tempest Re Bermuda	  	$	13	 	 	$	40	 	 	$	120	 	 	$	174	 	 	$	13	 	 	$	347	 	 	$	379	 	
ACE Tempest Re USA	  	 	118	 	 	 	134	 	 	 	175	 	 	 	188	 	 	 	181	 	 	 	615	 	 	 	902	 	
ACE Tempest Re Europe	  	 	40	 	 	 	37	 	 	 	33	 	 	 	110	 	 	 	57	 	 	 	220	 	 	 	269	 	
ACE Tempest Re Canada	  	 	3	 	 	 	4	 	 	 	4	 	 	 	4	 	 	 	—  	 	 	 	15	 	 	 	—  	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	174	 	 	$	215	 	 	$	332	 	 	$	476	 	 	$	251	 	 	$	1,197	 	 	$	1,550	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net premiums earned	  				 				 				 				 				 				 				
ACE Tempest Re Bermuda	  	$	91	 	 	$	90	 	 	$	87	 	 	$	88	 	 	$	96	 	 	$	356	 	 	$	367	 	
ACE Tempest Re USA	  	 	162	 	 	 	167	 	 	 	177	 	 	 	187	 	 	 	216	 	 	 	693	 	 	 	872	 	
ACE Tempest Re Europe	  	 	55	 	 	 	59	 	 	 	60	 	 	 	67	 	 	 	68	 	 	 	241	 	 	 	272	 	
ACE Tempest Re Canada	  	 	4	 	 	 	3	 	 	 	1	 	 	 	1	 	 	 	—  	 	 	 	9	 	 	 	—  	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	312	 	 	$	319	 	 	$	325	 	 	$	343	 	 	$	380	 	 	$	1,299	 	 	$	1,511	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net premiums written/gross premiums written	  				 				 				 				 				 				 				
ACE Tempest Re Bermuda	  	 	93	%	 	 	78	%	 	 	99	%	 	 	100	%	 	 	81	%	 	 	96	%	 	 	98	%	
ACE Tempest Re USA	  	 	100	%	 	 	100	%	 	 	100	%	 	 	100	%	 	 	100	%	 	 	100	%	 	 	100	%	
ACE Tempest Re Europe	  	 	95	%	 	 	95	%	 	 	94	%	 	 	98	%	 	 	98	%	 	 	96	%	 	 	97	%	
ACE Tempest Re Canada	  	 	100	%	 	 	100	%	 	 	100	%	 	 	100	%	 	 	—  	 	 	 	100	%	 	 	—  	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total NPW/GPW	  	 	98	%	 	 	94	%	 	 	99	%	 	 	100	%	 	 	98	%	 	 	98	%	 	 	99	%	

			
Global Reinsurance 2	 	Page 11	

			
	  	ACE Limited
Segment Results - Consecutive Quarters
(in millions of U.S. dollars)
(Unaudited)	

	  		
 
Life Insurance and Reinsurance

   	  	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	4Q-06	 	 	Full Year
2007	 	 	Full Year
2006	 	
Gross premiums written (1)	  	$	109	 	 	$	100	 	 	$	92	 	 	$	90	 	 	$	78	 	 	$	391	 	 	$	274	 	
Net premiums written	  	 	111	 	 	 	95	 	 	 	87	 	 	 	88	 	 	 	78	 	 	 	381	 	 	 	274	 	
Net premiums earned	  	 	98	 	 	 	95	 	 	 	87	 	 	 	88	 	 	 	78	 	 	 	368	 	 	 	274	 	
Life and annuity benefits	  	 	60	 	 	 	39	 	 	 	33	 	 	 	36	 	 	 	32	 	 	 	168	 	 	 	123	 	
Policy acquisition costs	  	 	9	 	 	 	13	 	 	 	12	 	 	 	11	 	 	 	9	 	 	 	45	 	 	 	26	 	
Administrative expenses	  	 	13	 	 	 	13	 	 	 	12	 	 	 	12	 	 	 	12	 	 	 	50	 	 	 	35	 	
Net investment income	  	 	15	 	 	 	14	 	 	 	14	 	 	 	12	 	 	 	12	 	 	 	55	 	 	 	42	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Life underwriting income (2)	  	 	31	 	 	 	44	 	 	 	44	 	 	 	41	 	 	 	37	 	 	 	160	 	 	 	132	 	
Net realized gains (losses)	  	 	(108	)	 	 	(51	)	 	 	(1	)	 	 	(4	)	 	 	(13	)	 	 	(164	)	 	 	(36	)	
Other (income) expense	  	 	1	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	1	 	 	 	—  	 	
Income tax expense (benefit)	  	 	(4	)	 	 	(3	)	 	 	1	 	 	 	(2	)	 	 	(5	)	 	 	(8	)	 	 	(6	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	 	(74	)	 	 	(4	)	 	 	42	 	 	 	39	 	 	 	29	 	 	 	3	 	 	 	102	 	
Net realized gains (losses)	  	 	(108	)	 	 	(51	)	 	 	(1	)	 	 	(4	)	 	 	(13	)	 	 	(164	)	 	 	(36	)	
Net realized gains (losses) in other (income) expense	  	 	1	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	1	 	 	 	—  	 	
Tax expense (benefit) on net realized gains (losses)	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) (3)	  	$	33	 	 	$	47	 	 	$	43	 	 	$	43	 	 	$	42	 	 	$	166	 	 	$	138	 	

(1)	Consistent with GAAP, premiums collected on universal life and investment contracts are considered deposits and excluded from premium revenue. For the quarters ended December 31, 2007, September 30, 2007, and June 30, 2007, premiums or deposits collected on investment and universal life contracts that are excluded from premium revenue above aggregated to $27.2 million, $17.4 million and $10.6 million, respectively. Previous to Q2-07, premiums collected on such contracts were inconsequential.	
 
(2)	We assess the performance of our Life Insurance and Reinsurance business based on life underwriting income which includes net investment income.	
 
(3)	See page 24 Non-GAAP Financial Measures.	

Life	 	Page 12	

			
	  	ACE Limited
Loss Reserve Rollforward
(in millions of U.S. dollars)
(Unaudited)	

	  		
																																					
 	  	Total	 	 	Ongoing	 	 	Run-off (1)	 	
 	  	Unpaid Losses	 	 	Unpaid Losses	 	 	Unpaid Losses	 	
 	  	Gross	 	 	Ceded	 	 	Net	 	 	Gross	 	 	Ceded	 	 	Net	 	 	Gross	 	 	Ceded	 	 	Net	 	
Balance at December 31, 2005	  	$	 35,055	 	 	$	 14,597	 	 	$	 20,458	 	 	$	 27,174	 	 	$	9,269	 	 	$	 17,905	 	 	$	 7,881	 	 	$	 5,328	 	 	$	 2,553	 	
										
Losses and loss expenses incurred	  	 	2,130	 	 	 	450	 	 	 	1,680	 	 	 	2,143	 	 	 	476	 	 	 	1,667	 	 	 	(13	)	 	 	(26	)	 	 	13	 	
Losses and loss expenses paid	  	 	(1,686	)	 	 	(503	)	 	 	(1,183	)	 	 	(1,486	)	 	 	(353	)	 	 	(1,133	)	 	 	(200	)	 	 	(150	)	 	 	(50	)	
Other (incl. foreign exch. revaluation)	  	 	9	 	 	 	10	 	 	 	(1	)	 	 	16	 	 	 	10	 	 	 	6	 	 	 	(7	)	 	 	—  	 	 	 	(7	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at March 31, 2006	  	 	35,508	 	 	 	14,554	 	 	 	20,954	 	 	 	27,847	 	 	 	9,402	 	 	 	18,445	 	 	 	7,661	 	 	 	5,152	 	 	 	2,509	 	
										
Losses and loss expenses incurred	  	 	2,378	 	 	 	630	 	 	 	1,748	 	 	 	2,349	 	 	 	618	 	 	 	1,731	 	 	 	29	 	 	 	12	 	 	 	17	 	
Losses and loss expenses paid	  	 	(2,536	)	 	 	(1,082	)	 	 	(1,454	)	 	 	(2,344	)	 	 	(938	)	 	 	(1,406	)	 	 	(192	)	 	 	(144	)	 	 	(48	)	
Other (incl. foreign exch. revaluation)	  	 	214	 	 	 	69	 	 	 	145	 	 	 	212	 	 	 	69	 	 	 	143	 	 	 	2	 	 	 	—  	 	 	 	2	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at June 30, 2006	  	 	35,564	 	 	 	14,171	 	 	 	21,393	 	 	 	28,064	 	 	 	9,151	 	 	 	18,913	 	 	 	7,500	 	 	 	5,020	 	 	 	2,480	 	
										
Losses and loss expenses incurred	  	 	2,582	 	 	 	764	 	 	 	1,818	 	 	 	2,588	 	 	 	797	 	 	 	1,791	 	 	 	(6	)	 	 	(33	)	 	 	27	 	
Losses and loss expenses paid	  	 	(2,395	)	 	 	(975	)	 	 	(1,420	)	 	 	(2,223	)	 	 	(893	)	 	 	(1,330	)	 	 	(172	)	 	 	(82	)	 	 	(90	)	
Other (Sale of certain run-off subsidiaries) (2)	  	 	(789	)	 	 	(317	)	 	 	(472	)	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	(789	)	 	 	(317	)	 	 	(472	)	
Other (incl. foreign exch. revaluation)	  	 	187	 	 	 	66	 	 	 	121	 	 	 	199	 	 	 	69	 	 	 	130	 	 	 	(12	)	 	 	(3	)	 	 	(9	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at September 30, 2006	  	 	35,149	 	 	 	13,709	 	 	 	21,440	 	 	 	28,628	 	 	 	9,124	 	 	 	19,504	 	 	 	6,521	 	 	 	4,585	 	 	 	1,936	 	
										
Losses and loss expenses incurred	  	 	2,780	 	 	 	956	 	 	 	1,824	 	 	 	2,477	 	 	 	710	 	 	 	1,767	 	 	 	303	 	 	 	246	 	 	 	57	 	
Losses and loss expenses paid	  	 	(2,613	)	 	 	(1,211	)	 	 	(1,402	)	 	 	(2,405	)	 	 	(1,078	)	 	 	(1,327	)	 	 	(208	)	 	 	(133	)	 	 	(75	)	
										
Other (incl. foreign exch. revaluation)	  	 	201	 	 	 	55	 	 	 	146	 	 	 	289	 	 	 	221	 	 	 	68	 	 	 	(88	)	 	 	(166	)	 	 	78	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at December 31, 2006	  	 	35,517	 	 	 	13,509	 	 	 	22,008	 	 	 	28,989	 	 	 	8,977	 	 	 	20,012	 	 	 	6,528	 	 	 	4,532	 	 	 	1,996	 	
										
Losses and loss expenses incurred	  	 	2,703	 	 	 	843	 	 	 	1,860	 	 	 	2,690	 	 	 	832	 	 	 	1,858	 	 	 	13	 	 	 	11	 	 	 	2	 	
Losses and loss expenses paid	  	 	(2,363	)	 	 	(943	)	 	 	(1,420	)	 	 	(2,206	)	 	 	(797	)	 	 	(1,409	)	 	 	(157	)	 	 	(146	)	 	 	(11	)	
Other (incl. foreign exch. revaluation)	  	 	(44)	 	 	 	4	 	 	 	(48)	 	 	 	(44)	 	 	 	4	 	 	 	(48)	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at March 31, 2007	  	 	35,813	 	 	 	13,413	 	 	 	22,400	 	 	 	29,429	 	 	 	9,016	 	 	 	20,413	 	 	 	6,384	 	 	 	4,397	 	 	 	1,987	 	
										
Losses and loss expenses incurred	  	 	2,280	 	 	 	487	 	 	 	1,793	 	 	 	2,249	 	 	 	473	 	 	 	1,776	 	 	 	31	 	 	 	14	 	 	 	17	 	
Losses and loss expenses paid	  	 	(2,111	)	 	 	(758	)	 	 	(1,353	)	 	 	(1,977	)	 	 	(637	)	 	 	(1,340	)	 	 	(134	)	 	 	(121	)	 	 	(13	)	
Other (incl. foreign exch. revaluation)	  	 	141	 	 	 	34	 	 	 	107	 	 	 	140	 	 	 	34	 	 	 	106	 	 	 	1	 	 	 	—  	 	 	 	1	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at June 30, 2007	  	 	36,123	 	 	 	13,176	 	 	 	22,947	 	 	 	29,841	 	 	 	8,886	 	 	 	20,955	 	 	 	6,282	 	 	 	4,290	 	 	 	1,992	 	
										
Losses and loss expenses incurred	  	 	3,010	 	 	 	1,100	 	 	 	1,910	 	 	 	2,999	 	 	 	1,093	 	 	 	1,906	 	 	 	11	 	 	 	7	 	 	 	4	 	
Losses and loss expenses paid	  	 	(2,429	)	 	 	(948	)	 	 	(1,481	)	 	 	(2,269	)	 	 	(833	)	 	 	(1,436	)	 	 	(160	)	 	 	(115	)	 	 	(45	)	
Other (incl. foreign exch. revaluation)	  	 	164	 	 	 	58	 	 	 	106	 	 	 	164	 	 	 	58	 	 	 	106	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at September 30, 2007	  	 	36,868	 	 	 	13,386	 	 	 	23,482	 	 	 	30,735	 	 	 	9,204	 	 	 	21,531	 	 	 	6,133	 	 	 	4,182	 	 	 	1,951	 	
										
Losses and loss expenses incurred	  	 	2,838	 	 	 	1,050	 	 	 	1,788	 	 	 	2,815	 	 	 	1,057	 	 	 	1,758	 	 	 	23	 	 	 	(7	)	 	 	30	 	
Losses and loss expenses paid	  	 	(2,613	)	 	 	(933	)	 	 	(1,680	)	 	 	(2,400	)	 	 	(806	)	 	 	(1,594	)	 	 	(213	)	 	 	(127	)	 	 	(86	)	
Other (incl. foreign exch. revaluation)	  	 	19	 	 	 	17	 	 	 	2	 	 	 	19	 	 	 	17	 	 	 	2	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at December 31, 2007	  	 	$37,112	 	 	 	$13,520	 	 	 	$23,592	 	 	 	$31,169	 	 	 	$9,472	 	 	 	$21,697	 	 	 	$5,943	 	 	 	$4,048	 	 	 	$1,895	 	

(1)	The run-off reserves primarily include the Brandywine group, the Commercial Insurance Service—Middle Market Workers’ Comp. reserves and the pre-1997 Westchester Specialty reserves.	
 
(2)	During the third quarter of 2006, ACE Limited completed the sale of three run-off reinsurance subsidiaries, ACE American Reinsurance Company, Brandywine Reinsurance Co. (UK) Ltd. and Brandywine Reinsurance Company S.A.-N.V. to Randall & Quilter Investment Holdings Limited.	

Loss Reserve Rollforward	 	Page 13	

			
	  	ACE Limited
Reinsurance Recoverable Analysis
(in millions of U.S. dollars)
(Unaudited)	

	  		
 
Net Reinsurance Recoverable by Division

 	  	December 31
2007	 	 	September 30
2007	 	 	June 30
2007	 	 	March 31
2007	 	 	December 31
2006	 	
Reinsurance recoverable on paid losses and loss expenses	  				 				 				 				 				
Active operations	  	$	697	 	 	$	761	 	 	$	820	 	 	$	922	 	 	$	1,013	 	
Brandywine	  	 	305	 	 	 	227	 	 	 	245	 	 	 	242	 	 	 	251	 	
Westchester Run-off	  	 	36	 	 	 	29	 	 	 	33	 	 	 	42	 	 	 	36	 	
Other Run-off	  	 	12	 	 	 	13	 	 	 	16	 	 	 	17	 	 	 	16	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	1,050	 	 	$	1,030	 	 	$	1,114	 	 	$	1,223	 	 	$	1,316	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Reinsurance recoverable on unpaid losses and loss expenses	  				 				 				 				 				
Active operations	  	$	10,024	 	 	$	9,753	 	 	$	9,418	 	 	$	9,505	 	 	$	9,479	 	
Brandywine	  	 	3,161	 	 	 	3,211	 	 	 	3,303	 	 	 	3,425	 	 	 	3,535	 	
Westchester Run-off	  	 	653	 	 	 	671	 	 	 	674	 	 	 	690	 	 	 	699	 	
Other Run-off	  	 	160	 	 	 	202	 	 	 	221	 	 	 	202	 	 	 	200	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	13,998	 	 	$	13,837	 	 	$	13,616	 	 	$	13,822	 	 	$	13,913	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross reinsurance recoverable	  				 				 				 				 				
Active operations	  	$	10,721	 	 	$	10,514	 	 	$	10,238	 	 	$	10,427	 	 	$	10,515	 	
Brandywine	  	 	3,466	 	 	 	3,438	 	 	 	3,548	 	 	 	3,667	 	 	 	3,786	 	
Westchester Run-off	  	 	689	 	 	 	700	 	 	 	707	 	 	 	732	 	 	 	712	 	
Other Run-off	  	 	172	 	 	 	215	 	 	 	237	 	 	 	219	 	 	 	216	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	15,048	 	 	$	14,867	 	 	$	14,730	 	 	$	15,045	 	 	$	15,229	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Provision for uncollectible reinsurance	  				 				 				 				 				
Active operations	  	$	(435	)	 	$	(430	)	 	$	(427	)	 	$	(455	)	 	$	(427	)	
Brandywine	  	 	(197	)	 	 	(164	)	 	 	(169	)	 	 	(169	)	 	 	(172	)	
Westchester Run-off	  	 	(31	)	 	 	(31	)	 	 	(31	)	 	 	(30	)	 	 	(30	)	
Other Run-off	  	 	(23	)	 	 	(24	)	 	 	(22	)	 	 	(17	)	 	 	(20	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	(686	)	 	$	(649	)	 	$	(649	)	 	$	(671	)	 	$	(649	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net reinsurance recoverable	  				 				 				 				 				
Active operations	  	$	10,286	 	 	$	10,084	 	 	$	9,811	 	 	$	9,972	 	 	$	10,088	 	
Brandywine	  	 	3,269	 	 	 	3,274	 	 	 	3,379	 	 	 	3,498	 	 	 	3,614	 	
Westchester Run-off	  	 	658	 	 	 	669	 	 	 	676	 	 	 	702	 	 	 	682	 	
Other Run-off	  	 	149	 	 	 	191	 	 	 	215	 	 	 	202	 	 	 	196	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	14,362	 	 	$	14,218	 	 	$	14,081	 	 	$	14,374	 	 	$	14,580	 	

			
Reinsurance Recoverable	 	Page 14	

			
	  	ACE Limited
Reinsurance Recoverable Analysis - 2
(in millions of U.S. dollars)
(Unaudited)	

	  		
 
Reinsurance Recoverable for Active Operations

 	  	September 30, 2007	 	
 	  	Recoverable	  	Provision	  	% of Gross	 	
Categories	  			  			  			
Top 10 reinsurers	  	$	5,152	  	$	66	  	1.3	%	
Other reinsurers balances >$20 million	  	 	2,271	  	 	45	  	2.0	%	
Other reinsurers balances <$20 million	  	 	547	  	 	59	  	10.8	%	
Mandatory pools and government agencies	  	 	573	  	 	3	  	0.5	%	
Structured settlements	  	 	220	  	 	7	  	3.2	%	
Captives	  	 	1,476	  	 	1	  	0.1	%	
Other (1)	  	 	275	  	 	249	  	90.5	%	
	  	 	 	  	 	 	  	 	 	
Total	  	$	10,514	  	$	430	  	4.1	%	

At September 30, 2007, $7.7 billion of the active operations’ recoverables were from rated reinsurers, of which 93.7% were rated the equivalent of A- or better by internationally recognized rating agencies. The Company held collateral of $3.3 billion, of which $2.1 billion was matched and usable against existing recoverables.

Top 10 Reinsurers (net of collateral) (2)	  	Other Reinsurers Balances Greater Than $20 million (net of collateral) (2)	
AGRI General Ins Co
American International Group (AIG)
Berkshire Hathaway Insurance Group
Chubb Insurance Group
Federal Crop Insurance Corp
HDI Haftpflichtverband Der Deutschen
    Industrie Vag (Hannover)
Lloyd’s Of London
Munich Re Group
Swiss Re Group
XL Capital Group	  	AIOI Insurance Group
Allianz
Allied World Assurance Group
Arch Capital
Aspen Insurance Holdings Ltd
AXA
CIGNA
Dow Chemical Co
Electric Insurance Company Group
Equitas
Everest Re Group
Fairfax Financial
Hartford Insurance Group
Independence Blue Cross Group
IRB - Brasil Resseguros S.A. Group	  	Liberty Mutual Insurance Companies
Partner Re
Platinum Underwriters
PMA Capital Corp
Power Corp Of Canada
Renaissance Re Holdings Ltd
Royal & Sun Alliance Insurance Group
SCOR Group
Sompo Japan Group
Toa Reinsurance Company
Travelers Companies Inc
White Mountains Insurance Group
WR Berkley Corp
Zurich Financial Services Group	

	  		  		

	  		  		

	  		  		

	  		  		

 
(1)	Other principally includes amounts recoverable that are in dispute, or are from companies who are in supervision, rehabilitation or liquidation. Our estimate of provision for uncollectible reinsurance associated with Other considers the credit quality of the reinsurer, and whether we have received collateral or other credit protections such as multi-beneficiary trusts and parental guarantees.	
 
(2)	Excludes recoverable amounts from companies who are in supervision, rehabilitation or liquidation, or are captive reinsurers, mandatory pools or voluntary pools.	

Reinsurance Rec-Active	 	Page 15	

			
	  	ACE Limited
Reinsurance Recoverable Analysis - 3
(in millions of U.S. dollars)
(Unaudited)	

	  		
 
Consolidated Reinsurance Recoverable

 	  	September 30, 2007	 	
 	  	Recoverable	  	Provision	  	% of Gross	 	
Categories	  			  			  			
Top 10 reinsurers	  	$	7,614	  	$	78	  	1.0	%	
Other reinsurers balances >$20 million	  	 	3,453	  	 	156	  	4.5	%	
Other reinsurers balances <$20 million	  	 	625	  	 	77	  	12.3	%	
Mandatory pools and government agencies	  	 	579	  	 	3	  	0.5	%	
Structured settlements	  	 	527	  	 	16	  	3.0	%	
Captives	  	 	1,574	  	 	6	  	0.4	%	
Other (1)	  	 	495	  	 	313	  	63.2	%	
	  	 	 	  	 	 	  	 	 	
Total	  	$	14,867	  	$	649	  	4.4	%	

At September 30, 2007, $11.2 billion of ACE Limited recoverables were from rated reinsurers, of which 93.8% were rated the equivalent of A- or better by internationally recognized rating agencies.

Top 10 Reinsurers (net of collateral) (2)	  	Other Reinsurers Balances Greater Than $20 million (net of collateral) (2)	
AGRI General Ins Co
American International Group (AIG)
Berkshire Hathaway Insurance Group
Chubb Insurance Group
Federal Crop Insurance Corp
HDI Haftpflichtverband Der Deutschen Industrie Vag (Hannover)
Lloyd’s Of London
Munich Re Group
Swiss Re Group
XL Capital Group	  	AIOI Insurance Group
Allianz
Allied World Assurance Group
Allstate Group
Arch Capital
Aspen Insurance Holdings Ltd
AVIVA Plc
AXA
CIGNA
CNA Insurance Companies
Dominion Insurance Co Ltd
Dow Chemical Co
Dukes Place Holdings	  	Electric Insurance Company Group
Enstar Group Ltd
Equitas
Everest Re Group
Fairfax Financial
FM Global Group
Globale Rueckversicherungs-AG
Hartford Insurance Group
Independence Blue Cross Group
ING Groep NV
IRB - Brasil Resseguros S.A. Group
Liberty Mutual Insurance Companies
Millea Holdings	  	Partner Re
Platinum Underwriters
PMA Capital Corp
Power Corp Of Canada
Renaissance Re Holdings Ltd
Royal & Sun Alliance Insurance Group
SCOR Group
Sompo Japan Group
Tawa UK Ltd
Toa Reinsurance Company
Travelers Companies Inc
Trenwick Group
White Mountains Insurance Group
WR Berkley Corp
Zurich Financial Services Group	

	  		  		  		

	  		  		  		

	  		  		  		

	  		  		  		

 
(1)	Other principally includes amounts recoverable that are in dispute, or are from companies who are in supervision, rehabilitation or liquidation. Our estimate of provision for uncollectible reinsurance associated with Other considers the credit quality of the reinsurer, and whether we have received collateral or other credit protections such as multi-beneficiary trusts and parental guarantees.	
 
(2)	Excludes recoverable amounts from companies who are in supervision, rehabilitation or liquidation, or are captive reinsurers, mandatory pools or voluntary pools.	

Reinsurance Rec-Consolidated	 	Page 16	

			
	  	ACE Limited
Reinsurance Recoverable Analysis - 4
(in millions of U.S. dollars)
(Unaudited)	

	  		
 
Detail on Reinsurance Recoverable on Paid Losses and Loss Expenses

 	  	General
Collections  (1)	 	 	Other  (2)	 	 	Total	 	
Gross balance at December 31, 2006	  	$	932	 	 	$	384	 	 	$	1,316	 	
Provision at 12/31/06	  	 	53	 	 	 	202	 	 	 	255	 	
% of gross	  	 	5.7	%	 	 	52.6	%	 	 	19.4	%	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net balance at December 31, 2006	  	$	879	 	 	$	182	 	 	$	1,061	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Gross balance at March 31, 2007	  	$	933	 	 	$	290	 	 	$	1,223	 	
Provision at 3/31/07	  	 	57	 	 	 	215	 	 	 	272	 	
% of gross	  	 	6.1	%	 	 	74.1	%	 	 	22.2	%	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net balance at March 31, 2007	  	$	876	 	 	$	75	 	 	$	951	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Gross balance at June 30, 2007	  	$	887	 	 	$	227	 	 	$	1,114	 	
Provision at 6/30/07	  	 	39	 	 	 	180	 	 	 	219	 	
% of gross	  	 	4.4	%	 	 	79.3	%	 	 	19.7	%	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net balance at June 30, 2007	  	$	848	 	 	$	47	 	 	$	895	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Gross balance at September 30, 2007	  	$	774	 	 	$	256	 	 	$	1,030	 	
Provision at 9/30/07	  	 	40	 	 	 	167	 	 	 	207	 	
% of gross	  	 	5.2	%	 	 	65.2	%	 	 	20.1	%	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net balance at September 30, 2007	  	$	734	 	 	$	89	 	 	$	823	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Gross balance at December 31, 2007	  	$	789	 	 	$	261	 	 	$	1,050	 	
Provision at 12/31/07	  	 	41	 	 	 	175	 	 	 	216	 	
% of gross	  	 	5.2	%	 	 	67.0	%	 	 	20.6	%	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net balance at December 31, 2007 (3)	  	$	748	 	 	$	86	 	 	$	834	 	

(1)	General collections balances represent amounts in process of collection in the normal course of business, for which we have no indication of dispute or credit issues.	
 
(2)	Other principally includes amounts recoverable that are in dispute, or are from companies who are in supervision, rehabilitation or liquidation for Brandywine Group and active operations. Our estimation of the reserve for other, considers the merits of the underlying matter, the credit quality of the reinsurer, and whether we have received collateral or other credit protections such as multi-beneficiary trusts and parental guarantees.	
 
(3)	The current quarter split between general collections and other is estimated based on prior quarter balances. Balances are adjusted to actual in the next quarter.	

Reinsurance Rec-Paid	 	Page 17	

			
	  	ACE Limited
Investment Portfolio
(in millions of U.S. dollars)
(Unaudited)	

	  		
																					
 	  	December 31
2007	 	 	September 30
2007	 	 	June 30
2007	 	 	March 31
2007	 	 	December 31
2006	 	
Market Value	  				 				 				 				 				
Fixed maturities available for sale	  	$	33,184	 	 	$	32,632	 	 	$	30,591	 	 	$	29,934	 	 	$	28,540	 	
Fixed maturities held to maturity	  	 	3,015	 	 	 	2,966	 	 	 	2,957	 	 	 	3,039	 	 	 	3,015	 	
Short-term investments	  	 	2,631	 	 	 	2,940	 	 	 	2,919	 	 	 	2,658	 	 	 	2,456	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	38,830	 	 	$	38,538	 	 	$	36,467	 	 	$	35,631	 	 	$	34,011	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Asset Allocation by Market Value	  				 				 				 				 				
Treasury	  	$	1,145	 	 	$	1,208	 	 	$	1,587	 	 	$	1,689	 	 	$	1,322	 	
Agency	  	 	1,820	 	 	 	1,901	 	 	 	2,117	 	 	 	2,223	 	 	 	2,207	 	
Corporate	  	 	9,015	 	 	 	8,579	 	 	 	7,643	 	 	 	7,473	 	 	 	7,394	 	
Mortgage-backed securities	  	 	13,733	 	 	 	13,542	 	 	 	12,338	 	 	 	11,925	 	 	 	11,346	 	
Asset-backed securities	  	 	1,150	 	 	 	1,377	 	 	 	1,611	 	 	 	1,772	 	 	 	2,020	 	
Municipal	  	 	1,844	 	 	 	1,603	 	 	 	1,367	 	 	 	1,157	 	 	 	809	 	
Non-U.S.	  	 	7,492	 	 	 	7,388	 	 	 	6,885	 	 	 	6,734	 	 	 	6,457	 	
Short-term investments	  	 	2,631	 	 	 	2,940	 	 	 	2,919	 	 	 	2,658	 	 	 	2,456	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	38,830	 	 	$	38,538	 	 	$	36,467	 	 	$	35,631	 	 	$	34,011	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Credit Quality by Market Value	  				 				 				 				 				
AAA	  	$	24,553	 	 	$	25,239	 	 	$	24,121	 	 	$	23,783	 	 	$	22,471	 	
AA	  	 	3,747	 	 	 	3,416	 	 	 	3,178	 	 	 	3,095	 	 	 	2,725	 	
A	  	 	4,590	 	 	 	4,059	 	 	 	3,902	 	 	 	3,582	 	 	 	3,909	 	
BBB	  	 	3,297	 	 	 	3,171	 	 	 	2,841	 	 	 	2,610	 	 	 	2,498	 	
BB	  	 	1,073	 	 	 	1,121	 	 	 	948	 	 	 	992	 	 	 	943	 	
B	  	 	1,481	 	 	 	1,437	 	 	 	1,376	 	 	 	1,475	 	 	 	1,365	 	
Other	  	 	89	 	 	 	95	 	 	 	101	 	 	 	94	 	 	 	100	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	38,830	 	 	$	38,538	 	 	$	36,467	 	 	$	35,631	 	 	$	34,011	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cost/Amortized Cost	  				 				 				 				 				
Fixed maturities available for sale	  	$	32,994	 	 	$	32,619	 	 	$	30,847	 	 	$	29,723	 	 	$	28,389	 	
Fixed maturities held to maturity	  	 	2,987	 	 	 	2,979	 	 	 	3,013	 	 	 	3,060	 	 	 	3,047	 	
Short-term investments	  	 	2,631	 	 	 	2,940	 	 	 	2,919	 	 	 	2,658	 	 	 	2,456	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Subtotal	  	 	38,612	 	 	 	38,538	 	 	 	36,779	 	 	 	35,441	 	 	 	33,892	 	
Equity securities	  	 	1,618	 	 	 	1,540	 	 	 	1,522	 	 	 	1,432	 	 	 	1,372	 	
Other investments	  	 	880	 	 	 	812	 	 	 	749	 	 	 	687	 	 	 	661	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	41,110	 	 	$	40,890	 	 	$	39,050	 	 	$	37,560	 	 	$	35,925	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Avg. duration of fixed maturities, adjusted for int. rate swaps	  	 	3.5 years	 	 	 	3.6 years	 	 	 	3.7 years	 	 	 	3.3 years	 	 	 	3.3 years	 	
Avg. market yield of fixed maturities	  	 	5.3	%	 	 	5.5	%	 	 	5.7	%	 	 	5.3	%	 	 	5.4	%	
Avg. credit quality	  	 	AA	 	 	 	AA	 	 	 	AA	 	 	 	AA	 	 	 	AA	 	

Investments	 	Page 18	

			
	  	ACE Limited
Investment Portfolio - 2
(in millions of U.S. dollars)
(Unaudited)	

	  		
 
Investment portfolio
 
Top 10 Exposures - Fixed Maturity Investments

December 31, 2007	    	December 31, 2006	
General Electric Co	  	$	336	    	General Electric Co	  	$	270	
Citigroup Inc	  	 	258	    	HSBC Holdings Plc	  	 	226	
Morgan Stanley	  	 	254	    	Citigroup Inc	  	 	200	
Bank of America Corp	  	 	247	    	Morgan Stanley	  	 	192	
Lehman Brothers Holdings Inc	  	 	246	    	Bank of America Corp	  	 	186	
JP Morgan Chase & Co	  	 	240	    	JP Morgan Chase & Co	  	 	179	
Goldman Sachs Group Inc	  	 	225	    	Comcast Corp	  	 	148	
HSBC Holdings Plc	  	 	212	    	Wells Fargo & Co	  	 	145	
Comcast Corp	  	 	171	    	Wachovia Corp	  	 	131	
AT&T Inc	  	 	165	    	Lehman Brothers Holdings Inc	  	 	129	

Investments 2	 	Page 19	

			
	  	ACE Limited
Investment Portfolio - 3
(in millions of U.S. dollars)
(Unaudited)	

	  		
 
Mortgage-backed and Asset-backed Fixed Income Portfolio
 
Market Value at December 31, 2007
																									
 	  	S&P Credit Rating	
 	  	AAA	  	AA	  	A	  	BBB	  	BB	  	B	  	Other	  	Total	
Mortgage-backed securities	  			  			  			  			  			  			  			  			
Residential mortgage-backed (RMBS)	  			  			  			  			  			  			  			  			
GNMA	  	$	395	  	$	—  	  	$	—  	  	$	—  	  	$	—  	  	$	—  	  	$	—  	  	$	395	
FNMA	  	 	5,330	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	5,330	
Freddie Mac	  	 	2,287	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	2,287	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total agency RMBS	  	 	8,012	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	8,012	
Non-agency RMBS	  	 	3,070	  	 	11	  	 	1	  	 	12	  	 	—  	  	 	—  	  	 	—  	  	 	3,094	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total residential mortgage-backed	  	 	11,082	  	 	11	  	 	1	  	 	12	  	 	—  	  	 	—  	  	 	—  	  	 	11,106	
									
Commercial mortgage-backed	  	 	2,611	  	 	3	  	 	10	  	 	3	  	 	—  	  	 	—  	  	 	—  	  	 	2,627	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total mortgage-backed securities	  	$	13,693	  	$	14	  	$	11	  	$	15	  	$	—  	  	$	—  	  	$	—  	  	$	13,733	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Asset-backed securities	  			  			  			  			  			  			  			  			
Sub-prime	  	$	125	  	$	2	  	$	8	  	$	—  	  	$	—  	  	$	—  	  	$	—  	  	$	135	
Credit cards	  	 	76	  	 	—  	  	 	17	  	 	8	  	 	—  	  	 	—  	  	 	—  	  	 	101	
Autos	  	 	621	  	 	27	  	 	8	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	656	
Other	  	 	255	  	 	—  	  	 	3	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	258	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total asset-backed securities	  	$	1,077	  	$	29	  	$	36	  	$	8	  	$	—  	  	$	—  	  	$	—  	  	$	1,150	

1)	Insured municipal bonds represent $848 million, or 46% of our municipal bond holdings.	
 
2)	Insured asset-backed securities represent $222 million, or 19% of our asset-backed security holdings.	
 
3)	Additional details were provided in a press release on December 18, 2007, none of the information provided has changed significantly.	

Investments 3	 	Page 20	

			
	  	ACE Limited
Net Realized and Unrealized Gains (Losses)
(in millions of U.S. dollars)
(Unaudited)	

	  		

 	  	Three months ended December 31, 2007	 	 	Year ended December 31, 2007	 	
 	  	Net Realized
Gains
(Losses) (1)	 	 	Net Unrealized
Gains
(Losses)	 	 	Net
  Impact  	 	 	Net Realized
Gains
(Losses) (1)	 	 	Net Unrealized
Gains
(Losses)	 	 	Net
Impact	 	
Fixed maturities	  	$	(8	)	 	$	185	 	 	$	177	 	 	$	(98	)	 	$	48	 	 	$	(50	)	
Equity securities	  	 	20	 	 	 	(107	)	 	 	(87	)	 	 	162	 	 	 	(122	)	 	 	40	 	
Equity and fixed income derivatives	  	 	(5	)	 	 	—  	 	 	 	(5	)	 	 	(19	)	 	 	—  	 	 	 	(19	)	
Foreign exchange gains (losses)	  	 	1	 	 	 	—  	 	 	 	1	 	 	 	4	 	 	 	—  	 	 	 	4	 	
Other	  	 	19	 	 	 	28	 	 	 	47	 	 	 	37	 	 	 	73	 	 	 	110	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Sub-total	  	 	27	 	 	 	106	 	 	 	133	 	 	 	86	 	 	 	(1	)	 	 	85	 	
Other FAS 133 adjustments (2)	  	 	(93	)	 	 	—  	 	 	 	(93	)	 	 	(147	)	 	 	—  	 	 	 	(147	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total gains (losses)	  	 	(66	)	 	 	106	 	 	 	40	 	 	 	(61	)	 	 	(1	)	 	 	(62	)	
Partially-owned insurance companies (3)	  	 	(57	)	 	 	33	 	 	 	(24	)	 	 	(95	)	 	 	25	 	 	 	(70	)	
Income tax expense (benefit)	  	 	(2	)	 	 	33	 	 	 	31	 	 	 	(22	)	 	 	23	 	 	 	1	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net gains (losses)	  	$	(121	)	 	$	106	 	 	$	(15	)	 	$	(134	)	 	$	1	 	 	$	(133	)	

(1)	The quarter includes impairments of $60M for fixed maturities and $9M for equities. The full year includes impairments of $123M for fixed maturities, $16M for equities and $2M for other investments.	
 
(2)	Other FAS 133 adjustments for the fourth quarter includes $105 million of realized losses primarily on the guaranteed minimum income benefit derivatives from our life reinsurance operations.	
 
(3)	Net realized and unrealized gains (losses) on partially-owned insurance companies that meet the requirements for equity accounting. The net income or loss is included in other (income) expense. The fourth quarter includes $73 million in net realized losses on derivatives from our investment in Assured Guaranty Ltd., carried at $392 million at December 31, 2007.	

 	  	Three months ended December 31, 2006	 	 	Year ended December 31, 2006	 	
 	  	Net Realized
Gains
(Losses) (4)	 	 	Net Unrealized
Gains
(Losses)	  	Net
Impact	 	 	Net Realized
Gains
(Losses) (4)	 	 	Net Unrealized
Gains
(Losses)	  	Net
Impact	 	
Fixed maturities	  	$	21	 	 	$	4	  	$	25	 	 	$	(220	)	 	$	134	  	$	(86	)	
Equity securities	  	 	39	 	 	 	85	  	 	124	 	 	 	163	 	 	 	114	  	 	277	 	
Equity and fixed income derivatives	  	 	(26	)	 	 	—  	  	 	(26	)	 	 	(18	)	 	 	—  	  	 	(18	)	
Foreign exchange gains (losses)	  	 	(2	)	 	 	—  	  	 	(2	)	 	 	(13	)	 	 	—  	  	 	(13	)	
Other	  	 	26	 	 	 	37	  	 	63	 	 	 	28	 	 	 	105	  	 	133	 	
	  	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Total inv. portfolio gains (losses)	  	 	58	 	 	 	126	  	 	184	 	 	 	(60	)	 	 	353	  	 	293	 	
Sale of run-off reinsurance subsidiaries	  	 	(32	)	 	 	—  	  	 	(32	)	 	 	(23	)	 	 	—  	  	 	(23	)	
Other FAS 133 adjustments	  	 	(11	)	 	 	—  	  	 	(11	)	 	 	(15	)	 	 	—  	  	 	(15	)	
	  	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Total gains (losses)	  	 	15	 	 	 	126	  	 	141	 	 	 	(98	)	 	 	353	  	 	255	 	
Income tax expense (benefit)	  	 	(7	)	 	 	19	  	 	12	 	 	 	(48	)	 	 	63	  	 	15	 	
	  	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	 	  	 	 	 	
Net gains (losses)	  	$	22	 	 	$	107	  	$	129	 	 	$	(50	)	 	$	290	  	$	240	 	

(4)	The quarter includes impairments of $12M for fixed maturities and $1M for equities. The full year includes impairments of $198M for fixed maturities, $10M for equities and $6M for other investments.	

Investment Gains (Losses)	 	Page 21	

			
	  	ACE Limited
Capital Structure
(in millions of U.S. dollars)
(Unaudited)	

	  		

 	  	December 31
2007	 	 	September 30
2007	 	 	June 30
2007	 	 	March 31
2007	 	 	December 31
2006	 	 	December 31
2005	 	
Total short-term debt	  	$	372	 	 	$	87	 	 	$	85	 	 	$	581	 	 	$	578	 	 	$	300	 	
Total long-term debt	  	 	1,811	 	 	 	2,068	 	 	 	2,063	 	 	 	2,061	 	 	 	1,560	 	 	 	1,811	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total debt	  	 	2,183	 	 	 	2,155	 	 	 	2,148	 	 	 	2,642	 	 	 	2,138	 	 	 	2,111	 	

Total trust preferred securities	  	 	309	 	 	 	309	 	 	 	309	 	 	 	309	 	 	 	309	 	 	 	309	 	

Perpetual preferred shares	  	 	557	 	 	 	557	 	 	 	557	 	 	 	557	 	 	 	557	 	 	 	557	 	
Ordinary shareholders’ equity	  	 	16,120	 	 	 	15,478	 	 	 	14,627	 	 	 	14,402	 	 	 	13,721	 	 	 	11,255	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total shareholders’ equity	  	$	16,677	 	 	$	16,035	 	 	$	15,184	 	 	$	14,959	 	 	$	14,278	 	 	$	11,812	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total capitalization	  	$	19,169	 	 	$	18,499	 	 	$	17,641	 	 	$	17,910	 	 	$	16,725	 	 	$	14,232	 	
Tangible shareholders’ equity (1)	  	$	13,946	 	 	$	13,304	 	 	$	12,453	 	 	$	12,228	 	 	$	11,547	 	 	$	9,109	 	
							
Leverage ratios	  				 				 				 				 				 				
Debt/ total capitalization	  	 	11.4	%	 	 	11.6	%	 	 	12.2	%	 	 	14.8	%	 	 	12.8	%	 	 	14.8	%	
Debt plus trust preferred securities/ total capitalization	  	 	13.0	%	 	 	13.3	%	 	 	13.9	%	 	 	16.5	%	 	 	14.6	%	 	 	17.0	%	
Debt/ tangible equity	  	 	15.7	%	 	 	16.2	%	 	 	17.2	%	 	 	21.6	%	 	 	18.5	%	 	 	23.2	%	
Debt plus trust preferred securities/ tangible equity	  	 	17.9	%	 	 	18.5	%	 	 	19.7	%	 	 	24.1	%	 	 	21.2	%	 	 	26.6	%	
Debt plus total preferred stock/ total capitalization	  	 	15.9	%	 	 	16.3	%	 	 	17.1	%	 	 	19.6	%	 	 	18.0	%	 	 	20.9	%	
 
(1)	Tangible equity is equal to shareholders’ equity less goodwill.	

Capital Structure	 	Page 22	

			
	  	ACE Limited
Computation of Basic and Diluted Earnings Per Share
(in millions of U.S. dollars, except share and per share data)
(Unaudited)	

	  		

 	  	Three months ended December 31	 	 	Year ended December 31	 	
 	  	2007	 	 	2006	 	 	2007	 	 	2006	 	
Numerator	  				 				 				 				
Income excluding net realized gains (losses) and cumulative effect (1)	  	$	693	 	 	$	643	 	 	$	2,712	 	 	$	2,351	 	
Perpetual preferred dividend	  	 	(12	)	 	 	(12	)	 	 	(45	)	 	 	(45	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income to ordinary shares, excl. net realized gains (losses) and cumulative effect	  	 	681	 	 	 	631	 	 	 	2,667	 	 	 	2,306	 	
Net realized gains (losses), net of income tax	  	 	(121	)	 	 	22	 	 	 	(134	)	 	 	(50	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income available to the holders of ordinary shares excluding cumulative effect	  	 	560	 	 	 	653	 	 	 	2,533	 	 	 	2,256	 	
Cumulative effect of a change in accounting principle, net of tax	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	4	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income available to the holders of ordinary shares	  	$	560	 	 	$	653	 	 	$	2,533	 	 	$	2,260	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Rollforward of Ordinary Shares	  				 				 				 				
Ordinary Shares - beginning of period	  	 	329,460,367	 	 	 	325,956,542	 	 	 	326,455,468	 	 	 	323,322,586	 	
Issued under employee stock purchase plan	  	 	—  	 	 	 	58	 	 	 	205,396	 	 	 	202,949	 	
Shares (cancelled) granted	  	 	(46,477	)	 	 	(41,791	)	 	 	1,212,603	 	 	 	947,373	 	
Issued for option exercises	  	 	290,641	 	 	 	540,659	 	 	 	1,831,064	 	 	 	1,982,560	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Ordinary Shares - end of period	  	 	329,704,531	 	 	 	326,455,468	 	 	 	329,704,531	 	 	 	326,455,468	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Denominator	  				 				 				 				
Weighted average shares outstanding	  	 	325,611,204	 	 	 	322,461,336	 	 	 	324,938,327	 	 	 	321,768,672	 	
Effect of other dilutive securities	  	 	5,645,111	 	 	 	5,905,367	 	 	 	5,509,394	 	 	 	5,463,350	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Adj. wtd. avg. shares outstanding and assumed conversions	  	 	331,256,315	 	 	 	328,366,703	 	 	 	330,447,721	 	 	 	327,232,022	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic earnings per share	  				 				 				 				
Income excluding net realized gains (losses) and cumulative effect (1)	  	$	2.09	 	 	$	1.96	 	 	$	8.21	 	 	$	7.17	 	
Net realized gains (losses), net of income tax	  	 	(0.37	)	 	 	0.07	 	 	 	(0.42	)	 	 	(0.16	)	
Cumulative effect of a change in accounting principle, net of tax	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	0.01	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	$	1.72	 	 	$	2.03	 	 	$	7.79	 	 	$	7.02	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Diluted earnings per share	  				 				 				 				
Income excluding net realized gains (losses) and cumulative effect (1)	  	$	2.05	 	 	$	1.92	 	 	$	8.07	 	 	$	7.05	 	
Net realized gains (losses), net of income tax	  	 	(0.36	)	 	 	0.07	 	 	 	(0.41	)	 	 	(0.15	)	
Cumulative effect of a change in accounting principle, net of tax	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	0.01	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	$	1.69	 	 	$	1.99	 	 	$	7.66	 	 	$	6.91	 	

(1)	See page 24 Non-GAAP Financial Measures.	

Earnings per share	 	Page 23	

			
	  	ACE Limited
Non-GAAP Financial Measures
(in millions of U.S. dollars)
(Unaudited)	

	  		
 
Regulation G - Non-GAAP Financial Measures
 
In presenting our results, we have included and discussed certain non-GAAP measures. These non-GAAP measures, which may be defined differently by other companies, are important for an understanding of our overall results of operations. However, they should not be viewed as a substitute for measures determined in accordance with GAAP. A reconciliation of book value per share is provided on page 25.
 
In presenting our segment operating results, we have shown our performance with reference to underwriting results. Underwriting results are calculated by subtracting losses and loss expenses, life and annuity benefits, policy acquisition costs, and administrative expenses from net premiums earned. We use underwriting results and operating ratios to monitor the results of our operations without the impact of certain factors, including investment income, other income and expenses, interest and income tax expense, and net realized gains (losses).
 
The following non-GAAP measure is a common performance measurement and is defined as income excluding net realized gains (losses), the tax expense (benefit) on net realized gains (losses), and cumulative effect of a change in accounting principle, net of tax. We believe this presentation enhances the understanding of our results of operations by highlighting the underlying profitability of our insurance business. We exclude net realized gains (losses) and net realized gains (losses) included in other (income) expense related to partially owned insurance companies because the amount of these gains (losses) is heavily influenced by, and fluctuates in part according to, the availability of market opportunities. We exclude the benefit of the cumulative effect of a change in accounting principle, net of tax, because this benefit resulted in a one time adjustment to income. We believe these amounts are largely independent of our business and including them would distort the analysis of trends. Income excluding net realized gains (losses) and cumulative effect should not be viewed as a substitute for net income determined in accordance with generally accepted accounting principles (GAAP).

 	  	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	4Q-06	 	 	Full Year
2007	 	 	Full Year
2006	 	
Net income, as reported	  	$	572	 	 	$	656	 	 	$	649	 	 	$	701	 	 	$	665	 	 	$	2,578	 	 	$	2,305	 	
Net realized gains (losses)	  	 	(66	)	 	 	—  	 	 	 	(11	)	 	 	16	 	 	 	15	 	 	 	(61	)	 	 	(98	)	
Net realized gains (losses) in other (income) expense (1)	  	 	(57	)	 	 	(38	)	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	(95	)	 	 	—  	 	
Income tax expense (benefit) on net realized gains (losses)	  	 	(2	)	 	 	(2	)	 	 	4	 	 	 	(22	)	 	 	(7	)	 	 	(22	)	 	 	(48	)	
Cumulative effect of a change in accounting principle, net of tax	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	4	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) and cumulative effect	  	$	693	 	 	$	692	 	 	$	664	 	 	$	663	 	 	$	643	 	 	$	2,712	 	 	$	2,351	 	

(1)	Realized gains (losses) on partially-owned insurance companies that meet the requirements for equity accounting. The net income or loss is included in other (income) expense.	

Reconciliation Non-GAAP	 	Page 24	

			
	  	ACE Limited
Book Value per Ordinary Share
(in millions of U.S. dollars, except share and per share data)
(Unaudited)	

	  		
 
Reconciliation of Book Value per Ordinary Share

 	  	December 31
2007	 	 	September 30
2007	 	 	June 30
2007	 	 	March 31
2007	 	 	December 31
2006	 	
Shareholders’ equity	  	$	16,677	 	 	$	16,035	 	 	$	15,184	 	 	$	14,959	 	 	$	14,278	 	
Proceeds from issuance of perpetual preferred shares	  	 	(557	)	 	 	(557	)	 	 	(557	)	 	 	(557	)	 	 	(557	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Numerator for book value per share calculation	  	 	16,120	 	 	 	15,478	 	 	 	14,627	 	 	 	14,402	 	 	 	13,721	 	
Less: goodwill	  	 	2,731	 	 	 	2,731	 	 	 	2,731	 	 	 	2,731	 	 	 	2,731	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Numerator for tangible book value per share	  	$	13,389	 	 	$	12,747	 	 	$	11,896	 	 	$	11,671	 	 	$	10,990	 	

Denominator	  	 	329,704,531	 	 	 	329,460,367	 	 	 	329,009,343	 	 	 	328,309,225	 	 	 	326,455,468	 	

Book value per ordinary share	  	$	48.89	 	 	$	46.98	 	 	$	44.46	 	 	$	43.87	 	 	$	42.03	 	
Tangible book value per ordinary share	  	$	40.61	 	 	$	38.69	 	 	$	36.16	 	 	$	35.55	 	 	$	33.66	 	

			
Reconciliation Book Value	 	Page 25	

			
	  	ACE Limited
Comprehensive Income
(in millions of U.S. dollars)
(Unaudited)	

	  		
 
Consolidated Statement of Comprehensive Income

   	  	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	4Q-06	 	 	Full Year
2007	 	 	Full Year
2006	 	
Net income	  	$	572	 	 	$	656	 	 	$	649	 	 	$	701	 	 	$	665	 	 	$	2,578	 	 	$	2,305	 	
Net unrealized appreciation (depreciation) on investments	  				 				 				 				 				 				 				
Unrealized appreciation (depreciation) on investments	  	 	133	 	 	 	218	 	 	 	(427	)	 	 	73	 	 	 	132	 	 	 	(3	)	 	 	289	 	
Reclassification adjustment for net realized gains (losses) included in net income	  	 	6	 	 	 	6	 	 	 	12	 	 	 	3	 	 	 	(6	)	 	 	27	 	 	 	64	 	
Change in cumulative translation adjustments	  	 	12	 	 	 	58	 	 	 	19	 	 	 	16	 	 	 	46	 	 	 	105	 	 	 	135	 	
Change in minimum pension liability	  	 	(1	)	 	 	(1	)	 	 	(2	)	 	 	—  	 	 	 	29	 	 	 	(4	)	 	 	20	 	
Income tax (expense) benefit related to other comprehensive income items	  	 	(37	)	 	 	(28	)	 	 	23	 	 	 	(18	)	 	 	(42	)	 	 	(60	)	 	 	(113	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other comprehensive income (loss)	  	 	113	 	 	 	253	 	 	 	(375	)	 	 	74	 	 	 	159	 	 	 	65	 	 	 	395	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Comprehensive income	  	$	685	 	 	$	909	 	 	$	274	 	 	$	775	 	 	$	824	 	 	$	2,643	 	 	$	2,700	 	

			
Comprehensive Income	 	Page 26	

			
	  	ACE Limited
Glossary	

Annualized return on ordinary shareholders’ equity (ROE): Income excluding net realized gains (losses) and cumulative effect less perpetual preferred securities divided by average ordinary shareholders’ equity for the period. To annualize a quarterly rate multiply by four.
 
Book value per ordinary share: Ordinary shareholders’ equity divided by the shares outstanding.
 
Combined ratio: The sum of the loss and loss expense ratio, acquisition cost ratio and the administrative expense ratio excluding life business. Calculated on a GAAP basis.
 
Cumulative effect: The benefit resulting from the accrual of a forfeiture rate on the restricted stock under Financial Accounting Standard 123R “Share-Based Payment”.
 
Effective tax rate: Income tax expense divided by the sum of income tax expense and income excluding net realized gains (losses) and cumulative effect.
 
FAS 115: Unrealized gains (losses) on investments and the deferred tax component included in shareholders’ equity.
 
Life underwriting income: Net premium earned and net investment income less future policy benefits, acquisition costs and administrative expenses.
 
NM: Not meaningful.
 
Ordinary shareholders’ equity: Shareholders’ equity less perpetual preferred shares.
 
P&C: Property and casualty.
 
Tangible book value per ordinary share: Ordinary shareholders’ equity less goodwill divided by the shares outstanding.
 
Tangible equity: Shareholders’ equity less goodwill.
 
Total capitalization: Short-term debt, long-term debt, trust preferreds, perpetual preferred shares and shareholders’ equity.
 
YTD: Year to date.

Glossary	 	Page 27