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) – April 29, 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 April 29 2008, ACE Limited issued a press release reporting its first quarter 2008 results and the availability of its first 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 April 29, 2008, reporting first quarter results	
		
99.2	  	First Quarter 2008 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: April 29, 2008

EXHIBIT INDEX

Number	  	Description	  	Method of Filing	
			
99.1	  	Press release, dated April 29, 2008, reporting first quarter results	  	Furnished herewith	
			
99.2	  	First Quarter 2008 Financial Supplement	  	Furnished herewith	

Exhibit 99.1

FOR IMMEDIATE RELEASE

	 		 		 	Investor Contact:	  	Helen M. Wilson	
	 		 		 		  	(441) 299-9283	
	 		 		 		  	helen.wilson@ace.bm	
					
	 		 		 	Media Contact:	  	Patrick F. McGovern	
	 		 		 		  	(212) 827-4426	
	 		 		 		  	patrick.mcgovern@ace-ina.com	
ACE LIMITED REPORTS FIRST QUARTER 2008 OPERATING INCOME UP 9.5%
TO RECORD $725 MILLION; NET INCOME OF $377 MILLION
HAMILTON, Bermuda, April 29, 2008 — ACE Limited (NYSE: ACE) today reported net income for the first quarter ended March 31, 2008, of $1.10 per common share after payment of preferred dividends, compared with $2.10 per share for the same quarter last year. Income excluding net realized gains (losses) for the first quarter was $2.16 per share, compared with $1.98 per share for the same quarter of last year. (1) The first quarter was marked by unprecedented financial market volatility in both the credit and equity markets, which impacted net income and book value. The net realized and unrealized loss after tax was $650 million for the quarter. This loss is the result of market pricing changes only. Actual credit-related impairments included in this number were insignificant, at approximately $20 million. Book value increased $58 million for the quarter, and the annualized return on average equity was 17.7%. (2)
First Quarter Summary
(in millions, except per share amounts)
(Unaudited)

 	  	 	 	 	 	  	 	 	 	(Per Share – Diluted)	 	
 	  	2008	 	 	2007	  	Change	 	 	2008	 	 	2007	  	Change	 	
Net income	  	$	377	 	 	$	701	  	(46	)%	 	$	1.10	 	 	$	2.10	  	(48	)%	
Net realized gains (losses), net of tax	  	 	(348	)	 	 	38	  	—  	 	 	 	(1.06	)	 	 	0.12	  	—  	 	
Income excluding net realized gains (losses), net of tax (1)	  	$	725	 	 	$	663	  	9.5	%	 	$	2.16	 	 	$	1.98	  	9	%	

Evan Greenberg, Chairman and Chief Executive Officer of ACE Limited, commented: “It was a busy and very good quarter for ACE. We closed two acquisitions – Combined Insurance and the Atlantic Companies’ personal lines business – and we announced our intention to re-domesticate our holding company to Zurich, Switzerland. These moves speak to the medium- and long-term strategic positioning of our Company. We had a strong quarter in terms of operating performance, with net operating income up 9.5%. Net income, which was down, and book value growth, which was essentially flat, were negatively impacted by the unprecedented volatility experienced in the debt and equity markets during the quarter. The business climate has grown more difficult globally, including the broad economy and financial markets. Ironically, the P&C market continues to grow more competitive. Our balance sheet and income statement are strong, and in the face of these realities, we are well positioned to seek out and capitalize upon opportunities on both the asset and liability sides of our balance sheet.”
Other operating highlights were as follows:
 
 	•	 	Net premiums written declined 4% over the prior year quarter.	
 
 	•	 	Net premiums earned declined 5% over the prior year quarter.	
 
 	•	 	The property and casualty (P&C) combined ratio for the quarter was 84.6% compared with 87.1% for the prior year quarter.	
 
 	•	 	P&C underwriting income increased 14% over the prior year quarter to $439 million.	
 
 	•	 	Underwriting income in the first quarter benefited from positive prior period development of $137 million compared to $18 million in the first quarter of last year. This was 90% short-tail-related, predominantly crop insurance and property.	
 
 	•	 	The P&C expense ratio reported in the quarter increased by 4.0 percentage points from last year’s first quarter to 29%. Of this increase, 1.6 percentage points related to a profit-sharing commission paid in the U.S. crop insurance book due to a profitable 2007 crop year, and 1.4 percentage points related to a large risk management contract written in last year’s first quarter.	
 
 	•	 	Operating cash flow was $1 billion for the quarter.	
 
 	•	 	Invested assets increased by $1.4 billion or 3% during the first quarter to $43.7 billion.	
 
 	•	 	Reinsurance recoverables decreased $393 million for the quarter to $13,969 million.	
 
 	•	 	Net loss reserves increased $463 million during the quarter to $23.2 billion.	
 
 	•	 	Net investment income increased 8% over the prior year quarter to $489 million.	
 
 	•	 	Return on average equity for the first quarter was 17.7%; excluding FAS 115, it was 18.2%. ( 2 )	
 
 	•	 	Book value increased $58 million from December 31, 2007 while book value per share (3) declined from $48.89 at December 31, 2007 to $48.65.	
 
 	•	 	The net realized and unrealized loss after tax was $650 million. This includes approximately $183 million from derivatives, principally related to the guaranteed minimum income benefit (GMIB) liabilities of our life reinsurance business, and $480 million from our investment portfolio, which comprises $150 million from high grade fixed income, $110 million from high yield and $220 million from equities and other.	
Details of our financial results for our business segments are available in the financial supplement. Key segment items include:
 
 	•	 	Insurance-North American: Net premiums written decreased 10% over the prior year quarter. The combined ratio was 86.0% compared with 88.4% for the same quarter last year. Last year’s quarter included $168 million of premiums written related to a large risk management contract, and in this year’s quarter we recorded $109 million in premiums written related to the Atlantic Companies’ personal lines business, now known as ACE Private Risk Services. Adjusting for these transactions, net written premiums would have decreased by approximately 7%.	
 
Page 2/7

 	•	 	Insurance-Overseas General: Net premiums written increased 13% over the prior year quarter, 6% on a currency-adjusted basis. The combined ratio was 82.7% compared with 85.4% for the same quarter last year.	
 
 	•	 	Global Reinsurance: Net premiums written decreased 28% over the prior year quarter. The combined ratio was 70.8% compared with 78% for the same quarter last year.	
 
 	•	 	Life Insurance and Reinsurance: Net premiums written increased 19% over the prior year quarter. Income excluding net realized gains (losses) decreased 23% to $33 million over the prior year quarter, primarily as a result of a reduction in our income related to our life reinsurance business. Net realized losses of $186 million are primarily attributable to the mark-to-market impact on the GMIB liabilities that are accounted for as derivatives. The losses resulted from an increase in the fair value liabilities relating to our reinsurance of guarantees for variable annuities. This is primarily the result of the adverse financial market changes in the first quarter, including negative equity returns, a reduction in long-term interest rates, and an increase in implied volatility for both equities and interest rates. This is purely a mark-to-market adjustment, required because the transactions are deemed to be derivatives for accounting purposes, and does not indicate negative cash flows on our reinsurance treaties. These results are in line with our expectations given these market conditions.	
The following earnings guidance has been updated for the full year 2008 and reflects the acquisition of Combined Insurance Company of America and certain of its subsidiaries, which was completed on April 1, 2008. We are now estimating that Combined Insurance will be 3.4% or $0.25 per share accretive for the remainder of 2008. This compares to our previous estimate of 2.6% or $0.19 per share accretive for the same time frame.
 
•	 	Operating Income per Share is expected to range between $7.40 and $7.90. The previous range was between $7.00 and $7.50.	
 
•	 	Property & Casualty Net Premiums Earned are expected to increase 1% to 3%. The previous range was a decline between 3% and 5%. The change is due primarily to the international portion of the Combined Insurance transaction.	
 
•	 	Consolidated Net Premiums Earned are expected to increase 8% to 10%. This is due primarily to the impact of the total Combined Insurance transaction.	
 
•	 	Catastrophe Losses included in our estimated earnings are $340 million pre-tax ($270 million after-tax) for the remainder of the year.	
Please refer to the ACE Limited Financial Supplement dated March 31, 2008, 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/irol/10/100907/fin_supp_march_31_2008.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 first quarter earnings conference call and webcast on Wednesday, April 30, 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 888-632-5021 (within the United States) or 913-312-0656 (international); passcode 5744621. 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 5744621.
 
Page 3/7

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), 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.
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 21 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).
 
2 	Calculated using income excluding net realized gains (losses) less perpetual preferred securities divided by average ordinary shareholders’ equity for the period. To annualize a quarterly rate, multiply by four.	
 
3 	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, such as those related to economic conditions, company performance, reserves and valuations, and integration of ACE’s recent acquisitions, 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, integration activities and unexpected financial or operational performance with respect to acquired companies, 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)

 	  	March 31
2008	  	December 31
2007	
 	  	(Unaudited)	  	 	
Assets	  			  			
Total investments	  	$	43,230	  	$	41,779	
Cash	  	 	511	  	 	510	
Insurance and reinsurance balances receivable	  	 	3,748	  	 	3,540	
Reinsurance recoverable	  	 	13,969	  	 	14,362	
Other assets	  	 	12,461	  	 	11,899	
	  	 	 	  	 	 	
Total assets	  	$	73,919	  	$	72,090	

Liabilities	  			  			
Unpaid losses and loss expenses	  	$	37,182	  	$	37,112	
Unearned premium	  	 	6,653	  	 	6,227	
Other liabilities	  	 	13,349	  	 	12,074	
	  	 	 	  	 	 	
Total liabilities	  	$	57,184	  	$	55,413	

Shareholders’ equity	  			  			
Total shareholders’ equity	  	$	16,735	  	$	16,677	
	  	 	 	  	 	 	
Total liabilities and shareholders’ equity	  	$	73,919	  	$	72,090	

Book value per ordinary share (3) 	  	$	48.65	  	$	48.89	
 
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
March 31	 	
 	  	2008	 	 	2007	 	
Gross premiums written	  	$	4,409	 	 	$	4,496	 	
Net premiums written	  	 	3,154	 	 	 	3,270	 	
Net premiums earned	  	 	2,940	 	 	 	3,082	 	
			
Losses and loss expenses	  	 	1,579	 	 	 	1,860	 	
Life and annuity benefits	  	 	63	 	 	 	36	 	
Policy acquisition costs	  	 	468	 	 	 	417	 	
Administrative expenses	  	 	375	 	 	 	356	 	
	  	 	 	 	 	 	 	 	
Underwriting income (1)	  	 	455	 	 	 	413	 	
			
Net investment income	  	 	489	 	 	 	451	 	
Net realized gains (losses)	  	 	(353	)	 	 	16	 	
Interest expense	  	 	46	 	 	 	46	 	
Other expense	  	 	15	 	 	 	4	 	
Income tax expense	  	 	153	 	 	 	129	 	
	  	 	 	 	 	 	 	 	
Net income	  	 	377	 	 	 	701	 	
Preferred share dividend	  	 	(11	)	 	 	(11	)	
	  	 	 	 	 	 	 	 	
Net income available to holders of ordinary shares	  	$	366	 	 	$	690	 	

Diluted earnings per share:	  				 				
Income excluding net realized gains (losses) (1)	  	$	2.16	 	 	$	1.98	 	
Net income	  	$	1.10	 	 	$	2.10	 	
			
Weighted average diluted shares outstanding	  	 	331.0	 	 	 	328.9	 	
Loss and loss expense ratio	  	 	55.6	%	 	 	62.1	%	
Policy acquisition cost ratio	  	 	16.2	%	 	 	13.5	%	
Administrative expense ratio	  	 	12.8	%	 	 	11.5	%	
Combined ratio	  	 	84.6	%	 	 	87.1	%	
 
Page 6/7

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

 	  	Three Months Ended
March 31	 	
 	  	2008	 	 	2007	 	
Gross Premiums Written	  				 				
Insurance – North American	  	$	2,181	 	 	$	2,269	 	
Insurance – Overseas General	  	 	1,778	 	 	 	1,659	 	
Global Reinsurance	  	 	345	 	 	 	478	 	
Life Insurance and Reinsurance	  	 	105	 	 	 	90	 	
	  	 	 	 	 	 	 	 	
Total	  	$	4,409	 	 	$	4,496	 	

Net Premiums Written	  				 				
Insurance – North American	  	$	1,360	 	 	$	1,514	 	
Insurance – Overseas General	  	 	1,345	 	 	 	1,192	 	
Global Reinsurance	  	 	344	 	 	 	476	 	
Life Insurance and Reinsurance	  	 	105	 	 	 	88	 	
	  	 	 	 	 	 	 	 	
Total	  	$	3,154	 	 	$	3,270	 	

Net Premiums Earned	  				 				
Insurance – North American	  	$	1,354	 	 	$	1,539	 	
Insurance – Overseas General	  	 	1,223	 	 	 	1,112	 	
Global Reinsurance	  	 	263	 	 	 	343	 	
Life Insurance and Reinsurance	  	 	100	 	 	 	88	 	
	  	 	 	 	 	 	 	 	
Total	  	$	2,940	 	 	$	3,082	 	

Income Excluding Net Realized Gains (Losses) (1) 	  				 				
Insurance – North American	  	$	327	 	 	$	298	 	
Insurance – Overseas General	  	 	256	 	 	 	215	 	
Global Reinsurance	  	 	144	 	 	 	132	 	
Life Insurance and Reinsurance	  	 	33	 	 	 	43	 	
Corporate	  	 	(35	)	 	 	(25	)	
	  	 	 	 	 	 	 	 	
Total	  	$	725	 	 	$	663	 	

Page 7/7

Exhibit 99.2

 
			
	  	Financial Supplement
 
March 31, 2008	
		
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	
			
III.	  	Segment Results	  		
	  	- Insurance - North American	  	6	
	  	- Insurance - Overseas General	  	7	
	  	- Global Reinsurance	  	8	
	  	- Life Insurance and Reinsurance	  	9	
			
IV.	  	Balance Sheet Details	  		
	  	- Loss Reserve Rollforward	  	10	
	  	- Reinsurance Recoverable Analysis	  	11-14	
	  	- Investment Portfolio	  	15-17	
	  	- Net Realized and Unrealized Gains (Losses)	  	18	
	  	- Capital Structure	  	19	
	  	- Computation of Basic and Diluted Earnings Per Share	  	20	
			
V.	  	Other Disclosures	  		
	  	- Non-GAAP Financial Measures	  	21	
	  	- Book Value per Ordinary Share	  	22	
	  	- Comprehensive Income	  	23	
	  	- Glossary	  	24	

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

												
 	  	Three months ended March 31	 	 	 	 	
 	  	2008	 	 	2007	 	 	% Change
1Q-08 vs.
1Q-07	 	
Gross premiums written	  	$	4,409	 	 	$	4,496	 	 	-2	%	
				
Net premiums written	  	$	3,154	 	 	$	3,270	 	 	-4	%	
				
Net premiums earned	  	$	2,940	 	 	$	3,082	 	 	-5	%	
				
Net investment income	  	$	489	 	 	$	451	 	 	8	%	
				
Net income	  	$	377	 	 	$	701	 	 	-46	%	
				
Income excluding net realized gains (losses) (1)	  	$	725	 	 	$	663	 	 	9	%	
				
Comprehensive income	  	$	88	 	 	$	775	 	 	-89	%	
				
Operating cash flow	  	$	1,015	 	 	$	1,236	 	 	-18	%	
				
Combined ratio	  				 				 			
Loss and loss expense ratio	  	 	55.6	%	 	 	62.1	%	 			
Underwriting and administrative expense ratio	  	 	29.0	%	 	 	25.0	%	 			
	  	 	 	 	 	 	 	 	 			
Combined ratio	  	 	84.6	%	 	 	87.1	%	 			
				
Annualized ROE*	  	 	17.7	%	 	 	18.5	%	 			
Annualized ROE, excluding FAS 115*	  	 	18.2	%	 	 	19.4	%	 			
				
Effective tax rate on income excluding net realized gains (losses)	  	 	20	%	 	 	19	%	 			
				
Diluted earnings per share	  				 				 			
Income excluding net realized gains (losses) (1)	  	$	2.16	 	 	$	1.98	 	 	9	%	
Net income	  	$	1.10	 	 	$	2.10	 	 	-48	%	
				
Book value per ordinary share	  	$	48.65	 	 	$	43.87	 	 	11	%	
Tangible book value per ordinary share	  	$	40.35	 	 	$	35.55	 	 	13	%	
				
Weighted average basic ordinary shares outstanding	  	 	327.0	 	 	 	324.1	 	 			
Weighted average diluted ordinary shares outstanding	  	 	331.0	 	 	 	328.9	 	 			
Debt/ total capitalization	  	 	16.9	%	 	 	14.8	%	 			
 
(1)	See page 21 Non-GAAP Financial Measures.	
 
*	Calculated using income excluding net realized gains (losses)	

Financial Highlights	  	Page 1	

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

 	  	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	Full Year
2007	 	
Property and Casualty	  				 				 				 				 				 				
Gross premiums written	  	$	4,304	 	 	$	4,035	 	 	$	4,363	 	 	$	4,545	 	 	$	4,406	 	 	$	17,349	 	
Net premiums written	  	 	3,049	 	 	 	2,716	 	 	 	2,705	 	 	 	2,995	 	 	 	3,182	 	 	 	11,598	 	
Net premiums earned	  	 	2,840	 	 	 	2,959	 	 	 	3,055	 	 	 	2,921	 	 	 	2,994	 	 	 	11,929	 	
Losses and loss expenses	  	 	1,579	 	 	 	1,788	 	 	 	1,910	 	 	 	1,793	 	 	 	1,860	 	 	 	7,351	 	
Policy acquisition costs	  	 	460	 	 	 	448	 	 	 	450	 	 	 	422	 	 	 	406	 	 	 	1,726	 	
Administrative expenses	  	 	362	 	 	 	372	 	 	 	345	 	 	 	344	 	 	 	344	 	 	 	1,405	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
P&C underwriting income	  	$	439	 	 	$	351	 	 	$	350	 	 	$	362	 	 	$	384	 	 	$	1,447	 	
Life underwriting income excluding investment income	  	 	16	 	 	 	16	 	 	 	30	 	 	 	30	 	 	 	29	 	 	 	105	 	
Net investment income	  	 	489	 	 	 	504	 	 	 	492	 	 	 	471	 	 	 	451	 	 	 	1,918	 	
Net realized gains (losses)	  	 	(353	)	 	 	(66	)	 	 	—  	 	 	 	(11	)	 	 	16	 	 	 	(61	)	
Interest expense	  	 	46	 	 	 	43	 	 	 	44	 	 	 	42	 	 	 	46	 	 	 	175	 	
Other income (expense) (1)	  	 	(15	)	 	 	(49	)	 	 	(32	)	 	 	4	 	 	 	(4	)	 	 	(81	)	
Income tax expense (benefit)	  	 	153	 	 	 	141	 	 	 	140	 	 	 	165	 	 	 	129	 	 	 	575	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	$	377	 	 	$	572	 	 	$	656	 	 	$	649	 	 	$	701	 	 	$	2,578	 	
Net realized gains (losses)	  	 	(353	)	 	 	(66	)	 	 	—  	 	 	 	(11	)	 	 	16	 	 	 	(61	)	
Net realized gains (losses) in other income (expense) (1)	  	 	(28	)	 	 	(57	)	 	 	(38	)	 	 	—  	 	 	 	—  	 	 	 	(95	)	
Tax expense (benefit) on net realized gains (losses)	  	 	(33	)	 	 	(2	)	 	 	(2	)	 	 	4	 	 	 	(22	)	 	 	(22	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) (2)	  	$	725	 	 	$	693	 	 	$	692	 	 	$	664	 	 	$	663	 	 	$	2,712	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
% Change versus prior year period (3) 	  				 				 				 				 				 				
Property and Casualty net premiums written	  	 	-4	%	 	 	-3	%	 	 	-1	%	 	 	0	%	 	 	-2	%	 	 	-1	%	
Property and Casualty net premiums earned	  	 	-5	%	 	 	0	%	 	 	1	%	 	 	3	%	 	 	9	%	 	 	3	%	
							
Other ratios	  				 				 				 				 				 				
Net premiums written/gross premiums written	  	 	71	%	 	 	67	%	 	 	62	%	 	 	66	%	 	 	72	%	 	 	67	%	
Effective tax rate on income excluding net realized gains (losses)	  	 	20	%	 	 	17	%	 	 	17	%	 	 	20	%	 	 	19	%	 	 	18	%	
							
Combined ratio (3) 	  				 				 				 				 				 				
Loss and loss expense ratio	  	 	55.6	%	 	 	60.4	%	 	 	62.5	%	 	 	61.4	%	 	 	62.1	%	 	 	61.6	%	
Policy acquisition cost ratio	  	 	16.2	%	 	 	15.1	%	 	 	14.7	%	 	 	14.5	%	 	 	13.5	%	 	 	14.5	%	
Administrative expense ratio	  	 	12.8	%	 	 	12.6	%	 	 	11.3	%	 	 	11.7	%	 	 	11.5	%	 	 	11.8	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Combined ratio	  	 	84.6	%	 	 	88.1	%	 	 	88.5	%	 	 	87.6	%	 	 	87.1	%	 	 	87.9	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Expense ratio P&C	  	 	29.0	%	 	 	27.7	%	 	 	26.0	%	 	 	26.2	%	 	 	25.0	%	 	 	26.3	%	
Expense ratio excluding A&H	  	 	25.8	%	 	 	24.6	%	 	 	22.8	%	 	 	23.6	%	 	 	21.9	%	 	 	23.2	%	
							
Large losses and other items (3) 	  				 				 				 				 				 				
Catastrophe losses (before tax)	  	$	31	 	 	$	23	 	 	$	21	 	 	$	81	 	 	$	34	 	 	$	159	 	
Prior period development - unfavorable (favorable) (4)	  	$	(137	)	 	$	(89	)	 	$	(70	)	 	$	(40	)	 	$	(18	)	 	$	(217	)	
 
(1)	Net realized investment and derivative losses related to our unconsolidated insurance affiliates.	
 
(2)	See page 21 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.	
 
(4)	For quarter 1 2008, prior period favorable development of $181 million less $44 million of profit share commission on Crop business settlement.	

Consolidated Results	  	Page 2	

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

 	  	March 31
2008	  	December 31
2007	
 	  	(Unaudited)	  	(Audited)	
Assets	  			  			
Fixed maturities available for sale, at fair value	  	$	32,619	  	$	33,184	
Fixed maturities held to maturity, at amortized cost	  	 	2,913	  	 	2,987	
Equity securities, at fair value	  	 	1,660	  	 	1,837	
Short-term investments, at fair value	  	 	4,795	  	 	2,631	
Other investments	  	 	1,243	  	 	1,140	
	  	 	 	  	 	 	
Total investments	  	 	43,230	  	 	41,779	
			
Cash	  	 	511	  	 	510	
Securities lending collateral	  	 	2,361	  	 	2,109	
Insurance and reinsurance balances receivable	  	 	3,748	  	 	3,540	
Reinsurance recoverable	  	 	13,969	  	 	14,362	
Deferred policy acquisition costs	  	 	1,220	  	 	1,121	
Prepaid reinsurance premiums	  	 	1,742	  	 	1,600	
Goodwill	  	 	2,763	  	 	2,731	
Deferred tax assets	  	 	1,054	  	 	1,087	
Investments in partially owned insurance companies	  	 	776	  	 	773	
Other assets	  	 	2,545	  	 	2,478	
	  	 	 	  	 	 	
Total assets	  	$	73,919	  	$	72,090	
	  	 	 	  	 	 	
Liabilities	  			  			
Unpaid losses and loss expenses	  	$	37,182	  	$	37,112	
Unearned premiums	  	 	6,653	  	 	6,227	
Future policy benefits for life and annuity contracts	  	 	632	  	 	545	
Insurance and reinsurance balances payable	  	 	2,756	  	 	2,843	
Deposit liabilities	  	 	362	  	 	351	
Securities lending payable	  	 	2,361	  	 	2,109	
Payable for securities purchased	  	 	1,391	  	 	1,798	
Accounts payable, accrued expenses and other liabilities	  	 	1,885	  	 	1,825	
Income taxes payable	  	 	198	  	 	111	
Short-term debt	  	 	1,341	  	 	372	
Long-term debt	  	 	2,114	  	 	1,811	
Trust preferred securities	  	 	309	  	 	309	
	  	 	 	  	 	 	
Total liabilities	  	 	57,184	  	 	55,413	
			
Shareholders’ equity	  			  			
Total shareholders’ equity, excl. AOCI	  	 	16,261	  	 	15,908	
Accumulated other comprehensive income (AOCI)	  	 	474	  	 	769	
	  	 	 	  	 	 	
Total shareholders’ equity	  	 	16,735	  	 	16,677	
	  	 	 	  	 	 	
Total liabilities and shareholders’ equity	  	$	73,919	  	$	72,090	
	  	 	 	  	 	 	
Book value per ordinary share (1) 	  	$	48.65	  	$	48.89	
Tangible book value per ordinary share (1) 	  	$	40.35	  	$	40.61	
 
(1)	See page 21 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

 	  	1Q-08	  	% of
Total
Consolidated	 	 	1Q-07	  	% of
Total
Consolidated	 	 	% Change
1Q-08 vs.
1Q-07	 	
Net premiums written	  			  			 			  			 			
Property and all other	  	$	1,073	  	34	%	 	$	1,003	  	30	%	 	7	%	
Casualty	  	 	1,476	  	47	%	 	 	1,759	  	54	%	 	-16	%	
Personal accident (A&H)	  	 	500	  	16	%	 	 	420	  	13	%	 	19	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Total P&C	  	 	3,049	  	97	%	 	 	3,182	  	97	%	 	-4	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Life	  	 	105	  	3	%	 	 	88	  	3	%	 	19	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Total Consolidated	  	$	3,154	  	100	%	 	$	3,270	  	100	%	 	-4	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Net premiums earned	  			  			 			  			 			
Property and all other	  	$	874	  	30	%	 	$	853	  	27	%	 	2	%	
Casualty	  	 	1,498	  	51	%	 	 	1,747	  	57	%	 	-14	%	
Personal accident (A&H)	  	 	468	  	16	%	 	 	394	  	13	%	 	19	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Total P&C	  	 	2,840	  	97	%	 	 	2,994	  	97	%	 	-5	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Life	  	 	100	  	3	%	 	 	88	  	3	%	 	14	%	
	  	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Total Consolidated	  	$	2,940	  	100	%	 	$	3,082	  	100	%	 	-5	%	

			
Line of Business	  	Page 4	

					
	  	ACE Limited
Consolidating Statement of Operations
Three months ended March 31, 2008 and 2007
(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	 	
March 31, 2008	  				 				 				 				 				 				 				
Gross premiums written	  	$	2,181	 	 	$	1,778	 	 	$	345	 	 	$	—  	 	 	$	4,304	 	 	$	105	 	 	$	4,409	 	
Net premiums written	  	 	1,360	 	 	 	1,345	 	 	 	344	 	 	 	—  	 	 	 	3,049	 	 	 	105	 	 	 	3,154	 	
Net premiums earned	  	 	1,354	 	 	 	1,223	 	 	 	263	 	 	 	—  	 	 	 	2,840	 	 	 	100	 	 	 	2,940	 	
Losses and loss expenses	  	 	869	 	 	 	593	 	 	 	117	 	 	 	—  	 	 	 	1,579	 	 	 	—  	 	 	 	1,579	 	
Life and annuity benefits	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	63	 	 	 	63	 	
Policy acquisition costs	  	 	161	 	 	 	245	 	 	 	54	 	 	 	—  	 	 	 	460	 	 	 	8	 	 	 	468	 	
Administrative expenses	  	 	135	 	 	 	173	 	 	 	15	 	 	 	39	 	 	 	362	 	 	 	13	 	 	 	375	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (loss)	  	 	189	 	 	 	212	 	 	 	77	 	 	 	(39	)	 	 	439	 	 	 	16	 	 	 	455	 	
								
Net investment income	  	 	269	 	 	 	117	 	 	 	73	 	 	 	15	 	 	 	474	 	 	 	15	 	 	 	489	 	
Net realized gains (losses)	  	 	(61	)	 	 	(83	)	 	 	(45	)	 	 	22	 	 	 	(167	)	 	 	(186	)	 	 	(353	)	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	46	 	 	 	46	 	 	 	—  	 	 	 	46	 	
Other income (expense)	  	 	—  	 	 	 	3	 	 	 	—  	 	 	 	(18	)	 	 	(15	)	 	 	—  	 	 	 	(15	)	
Income tax expense (benefit)	  	 	123	 	 	 	47	 	 	 	4	 	 	 	(19	)	 	 	155	 	 	 	(2	)	 	 	153	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income (loss)	  	 	274	 	 	 	202	 	 	 	101	 	 	 	(47	)	 	 	530	 	 	 	(153	)	 	 	377	 	
								
Net realized gains (losses)	  	 	(61	)	 	 	(83	)	 	 	(45	)	 	 	22	 	 	 	(167	)	 	 	(186	)	 	 	(353	)	
Net realized gains (losses) in other income (expense)	  	 	—  	 	 	 	7	 	 	 	—  	 	 	 	(35	)	 	 	(28	)	 	 	—  	 	 	 	(28	)	
Tax expense (benefit) on net realized gains (losses)	  	 	(8	)	 	 	(22	)	 	 	(2	)	 	 	(1	)	 	 	(33	)	 	 	—  	 	 	 	(33	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income (loss) excluding net realized gains (losses) (1)	  	$	327	 	 	$	256	 	 	$	144	 	 	$	(35	)	 	$	692	 	 	$	33	 	 	$	725	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
March 31, 2007	  				 				 				 				 				 				 				
Gross premiums written	  	$	2,269	 	 	$	1,659	 	 	$	478	 	 	$	—  	 	 	$	4,406	 	 	$	90	 	 	$	4,496	 	
Net premiums written	  	 	1,514	 	 	 	1,192	 	 	 	476	 	 	 	—  	 	 	 	3,182	 	 	 	88	 	 	 	3,270	 	
Net premiums earned	  	 	1,539	 	 	 	1,112	 	 	 	343	 	 	 	—  	 	 	 	2,994	 	 	 	88	 	 	 	3,082	 	
Losses and loss expenses	  	 	1,111	 	 	 	564	 	 	 	185	 	 	 	—  	 	 	 	1,860	 	 	 	—  	 	 	 	1,860	 	
Life and annuity benefits	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	36	 	 	 	36	 	
Policy acquisition costs	  	 	116	 	 	 	224	 	 	 	66	 	 	 	—  	 	 	 	406	 	 	 	11	 	 	 	417	 	
Administrative expenses	  	 	133	 	 	 	162	 	 	 	17	 	 	 	32	 	 	 	344	 	 	 	12	 	 	 	356	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (loss)	  	 	179	 	 	 	162	 	 	 	75	 	 	 	(32	)	 	 	384	 	 	 	29	 	 	 	413	 	
								
Net investment income	  	 	241	 	 	 	104	 	 	 	66	 	 	 	28	 	 	 	439	 	 	 	12	 	 	 	451	 	
Net realized gains (losses)	  	 	37	 	 	 	(26	)	 	 	6	 	 	 	3	 	 	 	20	 	 	 	(4	)	 	 	16	 	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	46	 	 	 	46	 	 	 	—  	 	 	 	46	 	
Other income (expense)	  	 	(9	)	 	 	(3	)	 	 	(1	)	 	 	9	 	 	 	(4	)	 	 	—  	 	 	 	(4	)	
Income tax expense (benefit)	  	 	128	 	 	 	40	 	 	 	7	 	 	 	(44	)	 	 	131	 	 	 	(2	)	 	 	129	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	 	320	 	 	 	197	 	 	 	139	 	 	 	6	 	 	 	662	 	 	 	39	 	 	 	701	 	
								
Net realized gains (losses)	  	 	37	 	 	 	(26	)	 	 	6	 	 	 	3	 	 	 	20	 	 	 	(4	)	 	 	16	 	
Tax expense (benefit) on net realized gains (losses)	  	 	15	 	 	 	(8	)	 	 	(1	)	 	 	(28	)	 	 	(22	)	 	 	—  	 	 	 	(22	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income (loss) excluding net realized gains (losses) (1)	  	$	298	 	 	$	215	 	 	$	132	 	 	$	(25	)	 	$	620	 	 	$	43	 	 	$	663	 	

(1)	See page 21 Non-GAAP Financial Measures.	

Segment 2008 Qtr	  	Page 5	

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

 	  	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	Full Year
2007	 	
Gross premiums written	  	$	2,181	 	 	$	2,274	 	 	$	2,708	 	 	$	2,589	 	 	$	2,269	 	 	$	9,840	 	
Net premiums written	  	 	1,360	 	 	 	1,373	 	 	 	1,449	 	 	 	1,497	 	 	 	1,514	 	 	 	5,833	 	
Net premiums earned	  	 	1,354	 	 	 	1,418	 	 	 	1,595	 	 	 	1,455	 	 	 	1,539	 	 	 	6,007	 	
Losses and loss expenses	  	 	869	 	 	 	1,004	 	 	 	1,138	 	 	 	1,016	 	 	 	1,111	 	 	 	4,269	 	
Policy acquisition costs	  	 	161	 	 	 	121	 	 	 	150	 	 	 	128	 	 	 	116	 	 	 	515	 	
Administrative expenses	  	 	135	 	 	 	138	 	 	 	129	 	 	 	130	 	 	 	133	 	 	 	530	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income	  	 	189	 	 	 	155	 	 	 	178	 	 	 	181	 	 	 	179	 	 	 	693	 	
Net investment income	  	 	269	 	 	 	276	 	 	 	260	 	 	 	257	 	 	 	241	 	 	 	1,034	 	
Net realized gains (losses)	  	 	(61	)	 	 	44	 	 	 	29	 	 	 	15	 	 	 	37	 	 	 	125	 	
Other income (expense)	  	 	—  	 	 	 	—  	 	 	 	(1	)	 	 	(1	)	 	 	(9	)	 	 	(11	)	
Income tax expense (benefit)	  	 	123	 	 	 	100	 	 	 	125	 	 	 	115	 	 	 	128	 	 	 	468	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	 	274	 	 	 	375	 	 	 	341	 	 	 	337	 	 	 	320	 	 	 	1,373	 	
Net realized gains (losses)	  	 	(61	)	 	 	44	 	 	 	29	 	 	 	15	 	 	 	37	 	 	 	125	 	
Tax expense (benefit) on net realized gains (losses)	  	 	(8	)	 	 	(2	)	 	 	—  	 	 	 	8	 	 	 	15	 	 	 	21	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) (1)	  	$	327	 	 	$	329	 	 	$	312	 	 	$	330	 	 	$	298	 	 	$	1,269	 	

Combined ratio	  				 				 				 				 				 				
Loss and loss expense ratio	  	 	64.1	%	 	 	70.8	%	 	 	71.3	%	 	 	69.8	%	 	 	72.2	%	 	 	71.1	%	
Policy acquisition cost ratio	  	 	11.9	%	 	 	8.6	%	 	 	9.4	%	 	 	8.8	%	 	 	7.5	%	 	 	8.6	%	
Administrative expense ratio	  	 	10.0	%	 	 	9.7	%	 	 	8.1	%	 	 	8.9	%	 	 	8.7	%	 	 	8.8	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Combined ratio	  	 	86.0	%	 	 	89.1	%	 	 	88.8	%	 	 	87.5	%	 	 	88.4	%	 	 	88.5	%	

Large losses and other items (before tax)	  				 				 				 				 				 				
Catastrophe losses (before tax)	  	$	15	 	 	$	—  	 	 	$	—  	 	 	$	16	 	 	$	—  	 	 	$	16	 	
Prior period development - unfavorable (favorable) (2)	  	$	(79	)	 	$	1	 	 	$	4	 	 	$	(6	)	 	$	10	 	 	$	9	 	
							
% Change versus prior year period	  				 				 				 				 				 				
Net premiums written	  	 	-10	%	 	 	-7	%	 	 	-1	%	 	 	0	%	 	 	1	%	 	 	-2	%	
Net premiums earned	  	 	-12	%	 	 	-4	%	 	 	3	%	 	 	6	%	 	 	15	%	 	 	5	%	
							
Other ratios	  				 				 				 				 				 				
Net premiums written/gross premiums written	  	 	62	%	 	 	60	%	 	 	54	%	 	 	58	%	 	 	67	%	 	 	59	%	
 
(1)	See page 21 Non-GAAP Financial Measures.	
 
(2)	For quarter 1 2008 prior period favorable development of $123 million less $44 million of profit share commission on Crop business settlement.	

Insurance - North American	  	Page 6	

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

 	  	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	Full Year
2007	 	
Gross premiums written	  	$	1,778	 	 	$	1,584	 	 	$	1,427	 	 	$	1,621	 	 	$	1,659	 	 	$	6,291	 	
Net premiums written	  	 	1,345	 	 	 	1,169	 	 	 	1,041	 	 	 	1,166	 	 	 	1,192	 	 	 	4,568	 	
Net premiums earned	  	 	1,223	 	 	 	1,229	 	 	 	1,141	 	 	 	1,141	 	 	 	1,112	 	 	 	4,623	 	
Losses and loss expenses	  	 	593	 	 	 	631	 	 	 	611	 	 	 	614	 	 	 	564	 	 	 	2,420	 	
Policy acquisition costs	  	 	245	 	 	 	269	 	 	 	240	 	 	 	230	 	 	 	224	 	 	 	963	 	
Administrative expenses	  	 	173	 	 	 	175	 	 	 	170	 	 	 	162	 	 	 	162	 	 	 	669	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income	  	 	212	 	 	 	154	 	 	 	120	 	 	 	135	 	 	 	162	 	 	 	571	 	
Net investment income	  	 	117	 	 	 	119	 	 	 	116	 	 	 	111	 	 	 	104	 	 	 	450	 	
Net realized gains (losses)	  	 	(83	)	 	 	(11	)	 	 	(5	)	 	 	(27	)	 	 	(26	)	 	 	(69	)	
Other income (expense)	  	 	3	 	 	 	12	 	 	 	12	 	 	 	(1	)	 	 	(3	)	 	 	20	 	
Income tax expense (benefit)	  	 	47	 	 	 	59	 	 	 	26	 	 	 	58	 	 	 	40	 	 	 	183	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	 	202	 	 	 	215	 	 	 	217	 	 	 	160	 	 	 	197	 	 	 	789	 	
Net realized gains (losses)	  	 	(83	)	 	 	(11	)	 	 	(5	)	 	 	(27	)	 	 	(26	)	 	 	(69	)	
Net realized gains (losses) in other income (expense)	  	 	7	 	 	 	15	 	 	 	11	 	 	 	—  	 	 	 	—  	 	 	 	26	 	
Tax expense (benefit) on net realized gains (losses)	  	 	(22	)	 	 	(1	)	 	 	(1	)	 	 	(4	)	 	 	(8	)	 	 	(14	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) (1)	  	$	256	 	 	$	210	 	 	$	210	 	 	$	183	 	 	$	215	 	 	$	818	 	

Combined ratio	  				 				 				 				 				 				
Loss and loss expense ratio	  	 	48.5	%	 	 	51.4	%	 	 	53.6	%	 	 	53.9	%	 	 	50.7	%	 	 	52.4	%	
Policy acquisition cost ratio	  	 	20.0	%	 	 	21.8	%	 	 	21.1	%	 	 	20.1	%	 	 	20.2	%	 	 	20.8	%	
Administrative expense ratio	  	 	14.2	%	 	 	14.3	%	 	 	14.8	%	 	 	14.2	%	 	 	14.5	%	 	 	14.5	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Combined ratio	  	 	82.7	%	 	 	87.5	%	 	 	89.5	%	 	 	88.2	%	 	 	85.4	%	 	 	87.7	%	

Large losses and other items	  				 				 				 				 				 				
Catastrophe losses (before tax)	  	$	15	 	 	$	13	 	 	$	8	 	 	$	58	 	 	$	15	 	 	 	94	 	
Prior period development - unfavorable (favorable)	  	$	(44	)	 	$	(76	)	 	$	(64	)	 	$	(31	)	 	$	(21	)	 	 	(192	)	
							
% Change versus prior year period	  				 				 				 				 				 				
Net premiums written	  	 	13	%	 	 	10	%	 	 	6	%	 	 	8	%	 	 	4	%	 	 	7	%	
Net premiums earned	  	 	10	%	 	 	12	%	 	 	4	%	 	 	5	%	 	 	7	%	 	 	7	%	
							
Other ratios	  				 				 				 				 				 				
Net premiums written/gross premiums written	  	 	76	%	 	 	74	%	 	 	73	%	 	 	72	%	 	 	72	%	 	 	73	%	
 
(1)	See page 21 Non-GAAP Financial Measures.	

Insurance - Overseas General	  	Page 7	

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

 	  	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	Full Year
2007	 	
Gross premiums written	  	$	345	 	 	$	177	 	 	$	228	 	 	$	335	 	 	$	478	 	 	$	1,218	 	
Net premiums written	  	 	344	 	 	 	174	 	 	 	215	 	 	 	332	 	 	 	476	 	 	 	1,197	 	
Net premiums earned	  	 	263	 	 	 	312	 	 	 	319	 	 	 	325	 	 	 	343	 	 	 	1,299	 	
Losses and loss expenses	  	 	117	 	 	 	155	 	 	 	161	 	 	 	163	 	 	 	185	 	 	 	664	 	
Policy acquisition costs	  	 	54	 	 	 	58	 	 	 	60	 	 	 	64	 	 	 	66	 	 	 	248	 	
Administrative expenses	  	 	15	 	 	 	17	 	 	 	14	 	 	 	16	 	 	 	17	 	 	 	64	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income	  	 	77	 	 	 	82	 	 	 	84	 	 	 	82	 	 	 	75	 	 	 	323	 	
Net investment income	  	 	73	 	 	 	73	 	 	 	69	 	 	 	66	 	 	 	66	 	 	 	274	 	
Net realized gains (losses)	  	 	(45	)	 	 	(3	)	 	 	25	 	 	 	(7	)	 	 	6	 	 	 	21	 	
Other income (expense)	  	 	—  	 	 	 	(1	)	 	 	—  	 	 	 	(2	)	 	 	(1	)	 	 	(4	)	
Income tax expense (benefit)	  	 	4	 	 	 	7	 	 	 	11	 	 	 	7	 	 	 	7	 	 	 	32	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	 	101	 	 	 	144	 	 	 	167	 	 	 	132	 	 	 	139	 	 	 	582	 	
Net realized gains (losses)	  	 	(45	)	 	 	(3	)	 	 	25	 	 	 	(7	)	 	 	6	 	 	 	21	 	
Tax expense (benefit) on net realized gains (losses)	  	 	(2	)	 	 	(1	)	 	 	—  	 	 	 	—  	 	 	 	(1	)	 	 	(2	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) (1)	  	$	144	 	 	$	146	 	 	$	142	 	 	$	139	 	 	$	132	 	 	$	559	 	

Combined ratio	  				 				 				 				 				 				
Loss and loss expense ratio	  	 	44.5	%	 	 	49.8	%	 	 	50.6	%	 	 	50.1	%	 	 	53.8	%	 	 	51.1	%	
Policy acquisition cost ratio	  	 	20.6	%	 	 	18.3	%	 	 	18.8	%	 	 	19.9	%	 	 	19.2	%	 	 	19.1	%	
Administrative expense ratio	  	 	5.7	%	 	 	5.5	%	 	 	4.2	%	 	 	5.0	%	 	 	5.0	%	 	 	4.9	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Combined ratio	  	 	70.8	%	 	 	73.6	%	 	 	73.6	%	 	 	75.0	%	 	 	78.0	%	 	 	75.1	%	

Large losses and other items	  				 				 				 				 				 				
Catastrophe losses (before tax)	  	$	1	 	 	$	10	 	 	$	13	 	 	$	7	 	 	$	19	 	 	$	49	 	
Prior period development - unfavorable (favorable)	  	$	(14	)	 	$	(14	)	 	$	(10	)	 	$	(3	)	 	$	(7	)	 	$	(34	)	
							
% Change versus prior year period	  				 				 				 				 				 				
Net premiums written	  	 	-28	%	 	 	-31	%	 	 	-24	%	 	 	-20	%	 	 	-21	%	 	 	-23	%	
Net premiums earned	  	 	-23	%	 	 	-18	%	 	 	-14	%	 	 	-16	%	 	 	-8	%	 	 	-14	%	
							
Other ratios	  				 				 				 				 				 				
Net premiums written/gross premiums written	  	 	100	%	 	 	98	%	 	 	94	%	 	 	99	%	 	 	100	%	 	 	98	%	
 
(1)	See page 21 Non-GAAP Financial Measures.	

Global Reinsurance	  	Page 8	

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

   	  	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	Full Year
2007	 	
Gross premiums written (1)	  	$	105	 	 	$	109	 	 	$	100	 	 	$	92	 	 	$	90	 	 	$	391	 	
Net premiums written	  	 	105	 	 	 	111	 	 	 	95	 	 	 	87	 	 	 	88	 	 	 	381	 	
Net premiums earned	  	 	100	 	 	 	98	 	 	 	95	 	 	 	87	 	 	 	88	 	 	 	368	 	
Life and annuity benefits	  	 	63	 	 	 	60	 	 	 	39	 	 	 	33	 	 	 	36	 	 	 	168	 	
Policy acquisition costs	  	 	8	 	 	 	9	 	 	 	13	 	 	 	12	 	 	 	11	 	 	 	45	 	
Administrative expenses	  	 	13	 	 	 	13	 	 	 	13	 	 	 	12	 	 	 	12	 	 	 	50	 	
Net investment income	  	 	15	 	 	 	15	 	 	 	14	 	 	 	14	 	 	 	12	 	 	 	55	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Life underwriting income (2)	  	 	31	 	 	 	31	 	 	 	44	 	 	 	44	 	 	 	41	 	 	 	160	 	
Net realized gains (losses)	  	 	(186	)	 	 	(108	)	 	 	(51	)	 	 	(1	)	 	 	(4	)	 	 	(164	)	
Other income (expense)	  	 	—  	 	 	 	(1	)	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	(1	)	
Income tax expense (benefit)	  	 	(2	)	 	 	(4	)	 	 	(3	)	 	 	1	 	 	 	(2	)	 	 	(8	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income (loss)	  	 	(153	)	 	 	(74	)	 	 	(4	)	 	 	42	 	 	 	39	 	 	 	3	 	
Net realized gains (losses)	  	 	(186	)	 	 	(108	)	 	 	(51	)	 	 	(1	)	 	 	(4	)	 	 	(164	)	
Net realized gains (losses) in other income (expense)	  	 	—  	 	 	 	1	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	1	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) (3)	  	$	33	 	 	$	33	 	 	$	47	 	 	$	43	 	 	$	43	 	 	$	166	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
% Change versus prior year period	  				 				 				 				 				 				
Net premiums written	  	 	19	%	 	 	42	%	 	 	38	%	 	 	32	%	 	 	44	%	 	 	39	%	
Net premiums earned	  	 	14	%	 	 	26	%	 	 	38	%	 	 	32	%	 	 	44	%	 	 	34	%	
 
(1)	Consistent with GAAP, premiums collected on universal life and investment contracts are considered deposits and excluded from premium revenue. For the quarters ended March 31, 2008, 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 $41.2 million, $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 21 Non-GAAP Financial Measures.	

Life	  	Page 9	

					
	 	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, 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	 	
										
Losses and loss expenses incurred	  	 	1,659	 	 	 	80	 	 	 	1,579	 	 	 	1,670	 	 	 	87	 	 	 	1,583	 	 	 	(11	)	 	 	(7	)	 	 	(4	)	
Losses and loss expenses paid	  	 	(1,748	)	 	 	(601	)	 	 	(1,147	)	 	 	(1,554	)	 	 	(406	)	 	 	(1,148	)	 	 	(194	)	 	 	(195	)	 	 	1	 	
Other (incl. foreign exch. revaluation)	  	 	159	 	 	 	71	 	 	 	88	 	 	 	159	 	 	 	71	 	 	 	88	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at March 31, 2008	  	$	37,182	 	 	$	13,070	 	 	$	24,112	 	 	$	31,444	 	 	$	9,224	 	 	$	22,220	 	 	$	5,738	 	 	$	3,846	 	 	$	1,892	 	

(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.	

Loss Reserve Rollforward	  	Page 10	

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

	 		  		

Net Reinsurance Recoverable by Division	  				 				
			
 	  	March 31
2008	 	 	December 31
2007	 	
Reinsurance recoverable on paid losses and loss expenses	  				 				
Active operations	  	$	686	 	 	$	697	 	
Brandywine	  	 	342	 	 	 	305	 	
Westchester Run-off	  	 	34	 	 	 	36	 	
Other Run-off	  	 	9	 	 	 	12	 	
	  	 	 	 	 	 	 	 	
Total	  	$	1,071	 	 	$	1,050	 	
	  	 	 	 	 	 	 	 	
Reinsurance recoverable on unpaid losses and loss expenses	  				 				
Active operations	  	$	9,778	 	 	$	10,024	 	
Brandywine	  	 	3,004	 	 	 	3,161	 	
Westchester Run-off	  	 	627	 	 	 	653	 	
Other Run-off	  	 	169	 	 	 	160	 	
	  	 	 	 	 	 	 	 	
Total	  	$	13,578	 	 	$	13,998	 	
	  	 	 	 	 	 	 	 	
Gross reinsurance recoverable	  				 				
Active operations	  	$	10,464	 	 	$	10,721	 	
Brandywine	  	 	3,346	 	 	 	3,466	 	
Westchester Run-off	  	 	661	 	 	 	689	 	
Other Run-off	  	 	178	 	 	 	172	 	
	  	 	 	 	 	 	 	 	
Total	  	$	14,649	 	 	$	15,048	 	
	  	 	 	 	 	 	 	 	
Provision for uncollectible reinsurance	  				 				
Active operations	  	$	(444	)	 	$	(435	)	
Brandywine	  	 	(189	)	 	 	(197	)	
Westchester Run-off	  	 	(31	)	 	 	(31	)	
Other Run-off	  	 	(16	)	 	 	(23	)	
	  	 	 	 	 	 	 	 	
Total	  	$	(680	)	 	$	(686	)	
	  	 	 	 	 	 	 	 	
Net reinsurance recoverable	  				 				
Active operations	  	$	10,020	 	 	$	10,286	 	
Brandywine	  	 	3,157	 	 	 	3,269	 	
Westchester Run-off	  	 	630	 	 	 	658	 	
Other Run-off	  	 	162	 	 	 	149	 	
	  	 	 	 	 	 	 	 	
Total	  	$	13,969	 	 	$	14,362	 	

			
Reinsurance Recoverable	  	Page 11	

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

	 		  		

Reinsurance Recoverable for Active Operations	  			  			  			
		
 	  	December 31, 2007	 	
 	  	Recoverable	  	Provision	  	% of Gross	 	
Categories	  			  			  			
Top 10 reinsurers	  	$	5,190	  	$	70	  	1.3	%	
Other reinsurers balances >$20 million	  	 	2,306	  	 	85	  	3.7	%	
Other reinsurers balances <$20 million	  	 	639	  	 	78	  	12.2	%	
Mandatory pools and government agencies	  	 	557	  	 	3	  	0.5	%	
Structured settlements	  	 	232	  	 	7	  	3.0	%	
Captives	  	 	1,408	  	 	2	  	0.1	%	
Other (1)	  	 	389	  	 	190	  	48.8	%	
	  	 	 	  	 	 	  	 	 	
Total	  	$	10,721	  	$	435	  	4.1	%	

At December 31, 2007, $7.6 billion of ACE Limited active operations recoverables were from rated reinsurers, of which 94.5% were rated the equivalent of A- or better by internationally recognized rating agencies. The Company held collateral of $3.2 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	 	AIOI Insurance Group	 	IRB - Brasil Resseguros S.A. Group	
American International Group	 	Allianz	 	Liberty Mutual Insurance Companies	
Berkshire Hathaway Insurance Group	 	Allied World Assurance Group	 	Partner Re	
Chubb Insurance Group	 	Arch Capital	 	Platinum Underwriters	
Federal Crop Insurance Corp	 	Aspen Insurance Holdings Ltd	 	PMA Capital Corp	
HDI Haftpflichtverband Der Deutschen Industrie Vag (Hannover)	 	AXA	 	Power Corp Of Canada	
Lloyd’s Of London	 	Brit Insurance Holding Plc	 	Renaissance Re Holdings Ltd	
Munich Re Group	 	CIGNA	 	Royal & Sun Alliance Insurance Group	
Swiss Re Group	 	Dow Chemical Co	 	SCOR Group	
XL Capital Group	 	Electric Insurance Company Group	 	Sompo Japan Group	
	 	Equitas	 	Toa Reinsurance Company	
	 	Everest Re Group	 	Travelers Companies Inc	
	 	Fairfax Financial	 	White Mountains Insurance Group	
	 	Hartford Insurance Group	 	WR Berkley Corp	
	 	Independence Blue Cross 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 12	

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

	 		  		

Consolidated Reinsurance Recoverable	  			  			  			
		
 	  	December 31, 2007	 	
   	  	Recoverable	  	Provision	  	% of Gross	 	
Categories	  			  			  			
Top 10 reinsurers	  	$	7,627	  	$	105	  	1.4	%	
Other reinsurers balances >$20 million	  	 	3,375	  	 	204	  	6.0	%	
Other reinsurers balances <$20 million	  	 	728	  	 	93	  	12.8	%	
Mandatory pools and government agencies	  	 	562	  	 	3	  	0.5	%	
Structured settlements	  	 	551	  	 	16	  	2.9	%	
Captives	  	 	1,507	  	 	21	  	1.4	%	
Other (1)	  	 	698	  	 	244	  	35.0	%	
	  	 	 	  	 	 	  	 	 	
Total	  	$	15,048	  	$	686	  	4.6	%	

At December 31, 2007, $10.7 billion of ACE Limited recoverables were from rated reinsurers, of which 94.4% 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)	
American International Group	 	AGRI General Ins Co	 	Dow Chemical Co	 	Platinum Underwriters	
Berkshire Hathaway Insurance Group	 	AIOI Insurance Group	 	Dukes Place Holdings	 	PMA Capital Corp	
Chubb Insurance Group	 	Allianz	 	Electric Insurance Company Group	 	Power Corp Of Canada	
Equitas	 	Allied World Assurance Group	 	Enstar Group Ltd	 	Renaissance Re Holdings Ltd	
Everest Re Group	 	Allstate Group	 	Fairfax Financial	 	Royal & Sun Alliance Insurance Group	
HDI Haftpflichtverband Der Deutschen Industrie Vag (Hannover)	 	Arch Capital	 	Federal Crop Insurance Corp	 	SCOR Group	
Lloyd’s Of London	 	Aspen Insurance Holdings Ltd	 	FM Global Group	 	Sompo Japan Group	
Munich Re Group	 	AVIVA Plc	 	Globale Rueckversicherungs-ag (Globale Re)	 	Tawa UK Ltd	
Swiss Re Group	 	AXA	 	Hartford Insurance Group	 	Toa Reinsurance Company	
XL Capital Group	 	Brit Insurance Holding Plc	 	Independence Blue Cross Group	 	Travelers Companies Inc	
	 	CIGNA	 	IRB - Brasil Resseguros S.A. Group	 	Trenwick Group	
	 	CNA Insurance Companies	 	Liberty Mutual Insurance Companies	 	White Mountains Insurance Group	
	 	Dominion Insurance Co Ltd	 	Millea Holdings	 	WR Berkley Corp	
	 		 	Partner Re	 	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 13	

					
	 	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, 2007	  	$	774	 	 	$	276	 	 	$	1,050	 	
Provision at 12/31/07	  	 	43	 	 	 	173	 	 	 	216	 	
% of gross	  	 	5.6	%	 	 	62.7	%	 	 	20.6	%	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net balance at December 31, 2007	  	$	731	 	 	$	103	 	 	$	834	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Gross balance at March 31, 2008	  	$	789	 	 	$	282	 	 	$	1,071	 	
Provision at 3/31/08	  	 	42	 	 	 	162	 	 	 	204	 	
% of gross	  	 	5.3	%	 	 	57.4	%	 	 	19.0	%	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net balance at March 31, 2008 (3) 	  	$	747	 	 	$	120	 	 	$	867	 	

(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 14	

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

	 		  		

 	  	March 31
2008	 	 	 	 	 	December 31
2007	 	 	 	 	
Market Value	  				 			 				 			
Fixed maturities available for sale	  	$	32,619	 	 			 	$	33,184	 	 			
Fixed maturities held to maturity	  	 	2,960	 	 			 	 	3,015	 	 			
Short-term investments (1)	  	 	4,795	 	 			 	 	2,631	 	 			
	  	 	 	 	 			 	 	 	 	 			
Total	  	$	40,374	 	 			 	$	38,830	 	 			
	  	 	 	 	 			 	 	 	 	 			
Asset Allocation by Market Value	  				 			 				 			
Treasury	  	$	974	 	 	2	%	 	$	1,145	 	 	3	%	
Agency	  	 	1,939	 	 	5	%	 	 	1,820	 	 	5	%	
Corporate	  	 	8,906	 	 	22	%	 	 	9,015	 	 	23	%	
Mortgage-backed securities	  	 	13,087	 	 	32	%	 	 	13,733	 	 	35	%	
Asset-backed securities	  	 	1,060	 	 	3	%	 	 	1,150	 	 	3	%	
Municipal	  	 	2,025	 	 	5	%	 	 	1,844	 	 	5	%	
Non-U.S.	  	 	7,588	 	 	19	%	 	 	7,492	 	 	19	%	
Short-term investments	  	 	4,795	 	 	12	%	 	 	2,631	 	 	7	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	40,374	 	 	100	%	 	$	38,830	 	 	100	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Credit Quality by Market Value	  				 			 				 			
AAA	  	$	26,162	 	 	65	%	 	$	24,553	 	 	63	%	
AA	  	 	3,746	 	 	9	%	 	 	3,747	 	 	10	%	
A	  	 	4,620	 	 	12	%	 	 	4,590	 	 	12	%	
BBB	  	 	3,188	 	 	8	%	 	 	3,297	 	 	8	%	
BB	  	 	1,249	 	 	3	%	 	 	1,073	 	 	3	%	
B	  	 	1,341	 	 	3	%	 	 	1,481	 	 	4	%	
Other	  	 	68	 	 	0	%	 	 	89	 	 	0	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	40,374	 	 	100	%	 	$	38,830	 	 	100	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cost/Amortized Cost	  				 			 				 			
Fixed maturities available for sale	  	$	32,615	 	 			 	$	32,994	 	 			
Fixed maturities held to maturity	  	 	2,913	 	 			 	 	2,987	 	 			
Short-term investments	  	 	4,795	 	 			 	 	2,631	 	 			
	  	 	 	 	 			 	 	 	 	 			
Subtotal	  	 	40,323	 	 			 	 	38,612	 	 			
Equity securities	  	 	1,597	 	 			 	 	1,618	 	 			
Other investments	  	 	992	 	 			 	 	880	 	 			
	  	 	 	 	 			 	 	 	 	 			
Total	  	$	42,912	 	 			 	$	41,110	 	 			
	  	 	 	 	 			 	 	 	 	 			
Avg. duration of fixed maturities, adjusted for int. rate swaps	  	 	3.5 years	 	 			 	 	3.5 years	 	 			
Avg. market yield of fixed maturities	  	 	5.1	%	 			 	 	5.3	%	 			
Avg. credit quality	  	 	AA	 	 			 	 	AA	 	 			
 
(1)	Liquidity required for the acquisition of Combined Insurance Company of America (Combined) on April 1, 2008.	

Investments	  	Page 15	

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

	 		  		

Mortgage-backed and Asset-backed Fixed Income Portfolio	
Market Value at March 31, 2008	
		
 	  	S&P Credit Rating	
 	  	AAA	  	AA	  	A	  	BBB	  	BB and below	  	Total	
Mortgage-backed securities	  			  			  			  			  			  			
Residential mortgage-backed (RMBS)	  			  			  			  			  			  			
GNMA	  	$	477	  	$	—  	  	$	—  	  	$	—  	  	$	—  	  	$	477	
FNMA	  	 	5,164	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	5,164	
Freddie Mac	  	 	2,159	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	2,159	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total agency RMBS	  	 	7,800	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	7,800	
Non-agency RMBS	  	 	2,851	  	 	10	  	 	2	  	 	11	  	 	—  	  	 	2,874	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total residential mortgage-backed	  	 	10,651	  	 	10	  	 	2	  	 	11	  	 	—  	  	 	10,674	
							
Commercial mortgage-backed	  	 	2,398	  	 	3	  	 	9	  	 	3	  	 	—  	  	 	2,413	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total mortgage-backed securities	  	$	13,049	  	$	13	  	$	11	  	$	14	  	$	—  	  	$	13,087	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Asset-backed securities	  			  			  			  			  			  			
Sub-prime	  	$	124	  	$	2	  	$	7	  	$	—  	  	$	—  	  	$	133	
Credit cards	  	 	61	  	 	—  	  	 	17	  	 	8	  	 	—  	  	 	86	
Autos	  	 	596	  	 	32	  	 	8	  	 	—  	  	 	—  	  	 	636	
Other	  	 	202	  	 	—  	  	 	3	  	 	—  	  	 	—  	  	 	205	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total asset-backed securities	  	$	983	  	$	34	  	$	35	  	$	8	  	$	—  	  	$	1,060	

1)	Insured municipal bonds represent $942 million, or 46% of our municipal bond holdings.	
 
2)	Insured asset-backed securities represent $192 million, or 18% of our asset-backed security holdings.	

Investments 2	  	Page 16	

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

	 		  		

Mortgage-backed and Asset-backed Fixed Income Portfolio	
Book Value at March 31, 2008	
		
 	  	S&P Credit Rating	
 	  	AAA	  	AA	  	A	  	BBB	  	BB and below	  	Total	
Mortgage-backed securities	  			  			  			  			  			  			
Residential mortgage-backed (RMBS)	  			  			  			  			  			  			
GNMA	  	$	466	  	$	—  	  	$	—  	  	$	—  	  	$	—  	  	$	466	
FNMA	  	 	5,043	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	5,043	
Freddie Mac	  	 	2,103	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	2,103	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total agency RMBS	  	 	7,612	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	7,612	
Non-agency RMBS	  	 	3,029	  	 	11	  	 	2	  	 	11	  	 	—  	  	 	3,053	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total residential mortgage-backed	  	 	10,641	  	 	11	  	 	2	  	 	11	  	 	—  	  	 	10,665	
							
Commercial mortgage-backed	  	 	2,407	  	 	3	  	 	10	  	 	3	  	 	—  	  	 	2,423	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total mortgage-backed securities	  	$	13,048	  	$	14	  	$	12	  	$	14	  	$	—  	  	$	13,088	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Asset-backed securities	  			  			  			  			  			  			
Sub-prime	  	$	137	  	$	2	  	$	8	  	$	—  	  	$	—  	  	$	147	
Credit cards	  	 	60	  	 	—  	  	 	17	  	 	8	  	 	—  	  	 	85	
Autos	  	 	591	  	 	32	  	 	7	  	 	—  	  	 	—  	  	 	630	
Other	  	 	201	  	 	—  	  	 	3	  	 	—  	  	 	—  	  	 	204	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total asset-backed securities	  	$	989	  	$	34	  	$	35	  	$	8	  	$	—  	  	$	1,066	

1)	Insured municipal bonds represent $931 million, or 46% of our municipal bond holdings.	
 
2)	Insured asset-backed securities represent $197 million, or 18% of our asset-backed security holdings.	

Investments 3	  	Page 17	

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

	 		  		

 	  	Three months ended March 31, 2008	 	
 	  	Net Realized
Gains
(Losses)  (1)	 	 	Net Unrealized
Gains
(Losses)	 	 	Net
Impact	 	
Fixed maturities	  	$	(105	)	 	$	(184	)	 	$	(289	)	
Equity securities	  	 	(54	)	 	 	(156	)	 	 	(210	)	
Equity and fixed income derivatives	  	 	(9	)	 	 	—  	 	 	 	(9	)	
Foreign exchange gains (losses)	  	 	6	 	 	 	—  	 	 	 	6	 	
Other	  	 	(26	)	 	 	(5	)	 	 	(31	)	
	  	 	 	 	 	 	 	 	 	 	 	 	
Sub-total	  	 	(188	)	 	 	(345	)	 	 	(533	)	
Unrealized losses from derivative transactions (2)	  	 	(165	)	 	 	—  	 	 	 	(165	)	
	  	 	 	 	 	 	 	 	 	 	 	 	
Total gains (losses)	  	 	(353	)	 	 	(345	)	 	 	(698	)	
Partially-owned insurance companies (3)	  	 	(28	)	 	 	21	 	 	 	(7	)	
Income tax expense (benefit)	  	 	(33	)	 	 	(22	)	 	 	(55	)	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net gains (losses)	  	$	(348	)	 	$	(302	)	 	$	(650	)	

(1)	The quarter includes impairments of $128M for fixed maturities, $36M for equities, and $25M for other investments.	
 
(2)	Other FAS 133 adjustments includes $183M of unrealized 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).	

 	  	Three months ended March 31, 2007	 	
 	  	Net Realized
Gains
(Losses)  (4)	 	 	Net Unrealized
Gains
(Losses)	 	 	Net
Impact	 	
Fixed maturities	  	$	(21	)	 	$	57	 	 	$	36	 	
Equity securities	  	 	34	 	 	 	(1	)	 	 	33	 	
Equity and fixed income derivatives	  	 	(7	)	 	 	—  	 	 	 	(7	)	
Foreign exchange gains (losses)	  	 	—  	 	 	 	—  	 	 	 	—  	 	
Other	  	 	10	 	 	 	20	 	 	 	30	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Sub-total	  	 	16	 	 	 	76	 	 	 	92	 	
Unrealized losses from derivative transactions	  	 	—  	 	 	 	—  	 	 	 	—  	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Total gains (losses)	  	 	16	 	 	 	76	 	 	 	92	 	
Income tax expense (benefit)	  	 	(22	)	 	 	13	 	 	 	(9	)	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net gains (losses)	  	$	38	 	 	$	63	 	 	$	101	 	

(4)	The quarter includes impairments of $37M for fixed maturities, $1M for equities, and $nil for other investments.	

Investment Gains (Losses)	  	Page 18	

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

	 		  		

 	  	March 31
2008	 	 	December 31
2007	 	 	December 31
2006	 	
Total short-term debt (1)	  	$	1,341	 	 	$	372	 	 	$	578	 	
Total long-term debt	  	 	2,114	 	 	 	1,811	 	 	 	1,560	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Total debt	  	$	3,455	 	 	$	2,183	 	 	$	2,138	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Total trust preferred securities	  	$	309	 	 	$	309	 	 	$	309	 	

Perpetual preferred shares	  	$	557	 	 	$	557	 	 	$	557	 	
Ordinary shareholders’ equity	  	 	16,178	 	 	 	16,120	 	 	 	13,721	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Total shareholders’ equity	  	$	16,735	 	 	$	16,677	 	 	$	14,278	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Total capitalization	  	$	20,499	 	 	$	19,169	 	 	$	16,725	 	
Tangible shareholders’ equity (2)	  	$	13,972	 	 	$	13,946	 	 	$	11,547	 	
				
Leverage ratios	  				 				 				
Debt/ total capitalization	  	 	16.9	%	 	 	11.4	%	 	 	12.8	%	
Debt plus trust preferred secutities/ total capitalization	  	 	18.4	%	 	 	13.0	%	 	 	14.6	%	
Debt/ tangible equity	  	 	24.7	%	 	 	15.7	%	 	 	18.5	%	
Debt plus trust preferred securities/ tangible equity	  	 	26.9	%	 	 	17.9	%	 	 	21.2	%	
Debt plus total preferred stock/ total capitalization	  	 	21.1	%	 	 	15.9	%	 	 	18.0	%	
 
(1)	First quarter of 2008 includes $1.0 billion of repurchase agreements for the Combined acquisition.	
 
(2)	Tangible equity is equal to shareholders’ equity less goodwill.	

Capital Structure	  	Page 19	

							
	 	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 March 31	 	
 	  	2008	 	 	2007	 	
Numerator	  				 				
Income excluding net realized gains (losses) (1)	  	$	725	 	 	$	663	 	
Perpetual preferred dividend	  	 	(11	)	 	 	(11	)	
	  	 	 	 	 	 	 	 	
Income to ordinary shares, excl. net realized gains (losses)	  	 	714	 	 	 	652	 	
Net realized gains (losses), net of income tax	  	 	(348	)	 	 	38	 	
	  	 	 	 	 	 	 	 	
Net income available to the holders of ordinary shares	  	$	366	 	 	$	690	 	
	  	 	 	 	 	 	 	 	
Rollforward of Ordinary Shares	  				 				
Ordinary Shares - beginning of period	  	 	329,704,531	 	 	 	326,455,468	 	
Issued under employee stock purchase plan	  	 	93,228	 	 	 	104,162	 	
Shares (cancelled) granted	  	 	1,174,680	 	 	 	1,394,898	 	
Issued for option exercises	  	 	1,534,108	 	 	 	354,697	 	
	  	 	 	 	 	 	 	 	
Ordinary Shares - end of period	  	 	332,506,547	 	 	 	328,309,225	 	
	  	 	 	 	 	 	 	 	
Denominator	  				 				
Weighted average shares outstanding	  	 	327,004,051	 	 	 	324,079,146	 	
Effect of other dilutive securities	  	 	4,031,290	 	 	 	4,818,859	 	
	  	 	 	 	 	 	 	 	
Adj. wtd. avg. shares outstanding and assumed conversions	  	 	331,035,341	 	 	 	328,898,005	 	
	  	 	 	 	 	 	 	 	
Basic earnings per share	  				 				
Income excluding net realized gains (losses) (1)	  	$	2.18	 	 	$	2.01	 	
Net realized gains (losses), net of income tax	  	 	(1.06	)	 	 	0.12	 	
	  	 	 	 	 	 	 	 	
Net income	  	$	1.12	 	 	$	2.13	 	
	  	 	 	 	 	 	 	 	
Diluted earnings per share	  				 				
Income excluding net realized gains (losses) (1)	  	$	2.16	 	 	$	1.98	 	
Net realized gains (losses), net of income tax	  	 	(1.06	)	 	 	0.12	 	
	  	 	 	 	 	 	 	 	
Net income	  	$	1.10	 	 	$	2.10	 	

(1)	See page 21 Non-GAAP Financial Measures.	

Earnings per share	  	Page 20	

					
	 	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 22.
 
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) and the related tax expense (benefit). 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. Income excluding net realized gains (losses) should not be viewed as a substitute for net income determined in accordance with generally accepted accounting principles (GAAP).

 	  	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	Full Year
2007	 	
Net income, as reported	  	$	377	 	 	$	572	 	 	$	656	 	 	$	649	 	 	$	701	 	 	$	2,578	 	
Net realized gains (losses)	  	 	(353	)	 	 	(66	)	 	 	—  	 	 	 	(11	)	 	 	16	 	 	 	(61	)	
Net realized gains (losses) in other income (expense) (1)	  	 	(28	)	 	 	(57	)	 	 	(38	)	 	 	—  	 	 	 	—  	 	 	 	(95	)	
Income tax expense (benefit) on net realized gains (losses)	  	 	(33	)	 	 	(2	)	 	 	(2	)	 	 	4	 	 	 	(22	)	 	 	(22	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses)	  	$	725	 	 	$	693	 	 	$	692	 	 	$	664	 	 	$	663	 	 	$	2,712	 	

(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 21	

							
	 	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	  				 				
			
 	  	March 31
2008	 	 	December 31
2007	 	
Shareholders’ equity	  	$	16,735	 	 	$	16,677	 	
Proceeds from issuance of perpetual preferred shares	  	 	(557	)	 	 	(557	)	
	  	 	 	 	 	 	 	 	
Numerator for book value per share calculation	  	 	16,178	 	 	 	16,120	 	
Less: goodwill	  	 	2,763	 	 	 	2,731	 	
	  	 	 	 	 	 	 	 	
Numerator for tangible book value per share	  	$	13,415	 	 	$	13,389	 	

Denominator	  	 	332,506,547	 	 	 	329,704,531	 	

Book value per ordinary share	  	$	48.65	 	 	$	48.89	 	
Tangible book value per ordinary share	  	$	40.35	 	 	$	40.61	 	

Reconciliation Book Value	  	Page 22	

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

	 		  		

Consolidated Statement of Comprehensive Income	 	
							
 	  	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	2Q-07	 	 	1Q-07	 	 	Full Year
2007	 	
Net income	  	$	377	 	 	$	572	 	 	$	656	 	 	$	649	 	 	$	701	 	 	$	2,578	 	
Net unrealized appreciation (depreciation) on investments	  				 				 				 				 				 				
Unrealized appreciation (depreciation) on investments	  	 	(497	)	 	 	133	 	 	 	218	 	 	 	(427	)	 	 	73	 	 	 	(3	)	
Reclassification adjustment for net realized (gains) losses included in net income	  	 	173	 	 	 	6	 	 	 	6	 	 	 	12	 	 	 	3	 	 	 	27	 	
Change in cumulative translation adjustment	  	 	27	 	 	 	12	 	 	 	58	 	 	 	19	 	 	 	16	 	 	 	105	 	
Change in minimum pension liability	  	 	—  	 	 	 	(1	)	 	 	(1	)	 	 	(2	)	 	 	—  	 	 	 	(4	)	
Income tax (expense) benefit related to other comprehensive income items	  	 	8	 	 	 	(37	)	 	 	(28	)	 	 	23	 	 	 	(18	)	 	 	(60	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other comprehensive income (loss)	  	 	(289	)	 	 	113	 	 	 	253	 	 	 	(375	)	 	 	74	 	 	 	65	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Comprehensive income	  	$	88	 	 	$	685	 	 	$	909	 	 	$	274	 	 	$	775	 	 	$	2,643	 	

			
Comprehensive Income	  	Page 23	

					
	 	ACE Limited
Glossary	  		

Annualized return on ordinary shareholders’ equity (ROE): Income excluding net realized gains (losses) 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.
 
Effective tax rate: Income tax expense divided by the sum of income tax expense and income excluding net realized gains (losses).
 
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.

Glossary	  	Page 24