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) – October 28, 2008
 
ACE LIMITED
(Exact name of registrant as specified in its charter)

Switzerland	 	1-11778	 	98-0091805	
(State or other jurisdiction
of Incorporation)	 	(Commission File Number)	 	(I.R.S. Employer
Identification No.)	
 
Mainaustrasse 30
Zurich CH-8008,
Switzerland
Telephone: +41 (0)43 456 76 00
(Address of principal executive offices)
 
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-(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 October 28, 2008, ACE Limited issued a press release reporting its third quarter 2008 results and the availability of its third 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 October 28, 2008, reporting third quarter results	
		
99.2	  	Third 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: October 28, 2008

EXHIBIT INDEX

Number	  	Description	  	Method of Filing	
			
99.1	  	Press release, dated October 28, 2008, reporting third quarter results	  	Furnished herewith	
			
99.2	  	Third 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:	  	Stephen M. Wasdick	
	 		 		 		  	(212) 827-4444	
	 		 		 		  	stephen.wasdick@ace-ina.com	
ACE LIMITED REPORTS THIRD QUARTER OPERATING INCOME OF $504 MILLION,
OR $1.51 PER SHARE; NET INCOME OF $54 MILLION, OR $0.16 PER SHARE
ZURICH, Switzerland – October 28, 2008 – ACE Limited (NYSE: ACE) today reported net income for the third quarter ended September 30, 2008, of $0.16 per share, compared with $1.95 per share for the same quarter last year. Income excluding net realized gains (losses) for the third quarter was $1.51 per share, compared with $2.06 per share for the same quarter of last year. (1) The quarter was marked by 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 $1.3 billion during the quarter. Book value decreased $971 million for the quarter and the annualized return on average equity was 12.7%.  (2) The combined ratio was 97.9%.
Third Quarter Summary
(in millions, except per share amounts )
(Unaudited)

 	  	 	 	 	 	 	 	 	 	 	(Per Share - Diluted)	 	
 	  	2008	 	 	2007	 	 	Change	 	 	2008	 	 	2007	 	 	Change	 	
Net income	  	$	54	 	 	$	656	 	 	(92	)%	 	$	0.16	 	 	$	1.95	 	 	(92	)%	
							
Net realized gains (losses), net of tax	  	 	(450	)	 	 	(36	)	 			 	 	(1.35	)	 	 	(0.11	)	 			
Income excluding net realized gains (losses), net of tax (1)	  	 	504	 	 	 	692	 	 	(27	)%	 	 	1.51	 	 	 	2.06	 	 	(27	)%	
							
Catastrophe losses, net of tax	  	 	311	 	 	 	22	 	 			 	 	0.93	 	 	 	0.07	 	 			
Prior period development (PPD) (favorable), net of tax	  	 	(211	)	 	 	(62	)	 			 	 	(0.63	)	 	 	(0.19	)	 			
							
Income excluding net realized gains (losses) catastrophe losses and PPD, net of tax (1)	  	$	604	 	 	$	652	 	 	(7	)%	 	$	1.81	 	 	$	1.94	 	 	(7	)%	
Net income for the first nine months of 2008 was $3.46 per share, compared with $5.98 per share for the first nine months of 2007. For the first nine months of 2008, income excluding net realized gains (losses) was $5.84 per share, compared with $6.02 per share for the same period of 2007. (1)  Book value decreased $764 million during the first nine months excluding the redemption of preferred shares. The results for the first nine months of 2008 reflect the acquisition of Combined Insurance effective April 1, 2008.

Nine Months Summary
(in millions, except per share amounts)
(Unaudited)

 	  	 	 	 	 	 	 	 	 	 	(Per Share - Diluted)	 	
 	  	2008	 	 	2007	 	 	Change	 	 	2008	 	 	2007	 	 	Change	 	
Net income	  	$	1,177	 	 	$	2,006	 	 	(41	)%	 	$	3.46	 	 	$	5.98	 	 	(42	)%	
							
Net realized gains (losses), net of tax	  	 	(790	)	 	 	(13	)	 			 	 	(2.38	)	 	 	(0.04	)	 			
							
Income excluding net realized gains (losses), net of tax (1)	  	$	1,967	 	 	$	2,019	 	 	(3	)%	 	$	5.84	 	 	$	6.02	 	 	(3	)%	
“ACE performed relatively well in a period marked by extraordinary financial market conditions and significant natural catastrophes. Our financial results demonstrated balance sheet stability and earnings strength,” said Evan G. Greenberg, Chairman and Chief Executive Officer of ACE Limited.
“For the quarter, we recorded operating income of $504 million, generated a return on equity of 12.7%, and our combined ratio was 97.9%. Our book value in the quarter was impacted by the extreme movement in financial asset prices and declined 6%, while in the last 12 months, our book value has remained stable, down less than 1%.
“In my judgment, given both the rapid destruction and increased cost of capital, combined with the damage inflicted on a number of companies in our industry, the soft market for P&C insurance is essentially over, and rates will begin to firm. These challenging times will create opportunities for those companies with the financial wherewithal and franchise power to take advantage, and I’m confident ACE will be one of them.”
Other operating highlights were as follows:
 
 	•	 	Net premiums written and earned increased 17% and 15%, respectively, over the prior year quarter (4% and 3%, respectively, excluding Combined Insurance).	
 
 	•	 	The combined ratio for the quarter was 97.9% compared with 88.5% for the prior year quarter; year-to-date, the combined ratio was 90.4% compared with 87.8% for the prior year period.	
 
 	•	 	The combined ratio for the quarter excluding catastrophe losses was 85.2% compared with 87.8% for the prior year quarter; year-to-date, the combined ratio excluding catastrophe losses was 84.9% compared with 86.1% for the prior year period.	
 
 	•	 	Pre-tax underwriting income excluding the life segment decreased 81% over the prior year quarter to $66 million pre-tax due to catastrophe losses of $418 million offset by positive prior period development of $277 million compared to $70 million for the same quarter last year.	
 
 	•	 	The expense ratio reported in the quarter increased by 2.4 percentage points from last year’s third quarter. The addition of Combined Insurance contributed approximately 0.7 percent to this increase, while 0.4 percent was related to the change in our business mix to reflect growth in A&H and international P&C, which have higher expense ratios.	
 
 	•	 	Operating cash flow was $1 billion for the quarter.	
 
 	•	 	Reinsurance recoverables increased $386 million for the quarter due to catastrophe losses; year-to-date, reinsurance recoverables decreased $129 million.	
 
 	•	 	Net loss reserves increased $291 million during the quarter; year-to-date, net loss reserves increased $1.4 billion.	
 
 	•	 	Net investment income increased 6% over the prior year quarter to $520 million.	
 
Page 2/7

 	•	 	Return on average equity for the third quarter was 12.7% and for the nine months of 2008 was 16.5%.	
 
 	•	 	Book value decreased $764 million from December 31, 2007 excluding the redemption of the preferred shares while book value per share (3 ) decreased from $48.89 at December 31, 2007 to $46.06.	
 
 	•	 	Net realized and unrealized losses after tax from our investment portfolio totaled $1.1 billion. This includes $854 million of unrealized losses and $281 million of realized losses. Net realized losses from derivatives related to the guaranteed minimum income benefit (GMIB) liabilities of our life reinsurance business were approximately $161 million. Net realized and unrealized losses from the company’s share of partially-owned insurance companies were approximately $43 million.	
Details of our financial results for our business segments are available in the ACE Limited Financial Supplement. Key segment items include:
 
 	•	 	Insurance-North American: Net premiums written increased 1% over the prior year quarter. The combined ratio was 104.1% compared with 88.8% for the same quarter last year. The combined ratio excluding catastrophe losses was 86.9% compared with 88.8% for the same quarter last year.	
 
 	•	 	Insurance-Overseas General: Net premiums written increased 24% over the prior year quarter, 18% on a currency-adjusted basis. The combined ratio was 89.9% compared with 89.5% for the same quarter last year.	
 
 	•	 	Global Reinsurance: Net premiums written decreased 19% over the prior year quarter. The combined ratio was 91.5% compared with 73.6% for the same quarter last year. The combined ratio excluding catastrophe losses was 53.7% compared with 69.5% for the same quarter last year.	
 
 	•	 	Life Insurance and Reinsurance: Net premiums written increased 266% over the prior year quarter; excluding the results of Combined Insurance, net premiums written increased 8%. Income excluding net realized gains (losses) increased 40% to $66 million over the prior year quarter; excluding the results of Combined Insurance, operating income decreased 36% to $30 million.	
Please refer to the ACE Limited Financial Supplement dated September 30, 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_september _30_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 third quarter earnings conference call and webcast on Wednesday, October 29, 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 888-296-4305 (within the United States) or 719-457-2654 (international); passcode 8076874. 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 8076874.
The ACE Group of Companies is a global leader in insurance and reinsurance serving a diverse group of clients. Headed by ACE Limited, 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.
 
Page 3/7

Income excluding net realized gains (losses), catastrophe losses and prior period development, net of tax is a non-GAAP measure. We present income excluding net realized gains (losses), catastrophe losses and prior period development, net of tax because those events are deemed to be significant for the third quarter of 2008. We believe this separate presentation is meaningful and useful for users of our financial information.
Underwriting income is calculated by subtracting losses and loss expenses, future policy 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 and other intangible assets. See reconciliation of Non-GAAP Financial Measures on page 29 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 common shareholders’ equity for the period. To annualize a quarterly rate, multiply by four.	

3 	Book value per common share is common shareholders’ equity divided by the shares outstanding. Tangible book value per common share is common shareholders’ equity less goodwill and other intangible assets divided by the shares outstanding.	
Cautionary Statement Regarding Forward-Looking Statements :
Forward-looking statements made in this press release, such as those related to the P&C insurance market and ACE’s performance therein, as well as economic conditions, company performance, reserves and valuations, 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 described above could be affected by continued adverse economic and insurance industry developments such as those of recent weeks, as well as 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, investment portfolio performance, integration activities and unexpected financial or operational performance with respect to acquired companies, unexpected effects or difficulties relating to the Company’s recent re-domestication to Switzerland, 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)

 	  	September 30
2008	  	December 31
2007	
 	  	(Unaudited)	  	 	
Assets	  			  			
Total investments	  	$	41,811	  	$	41,779	
Cash	  	 	479	  	 	510	
Insurance and reinsurance balances receivable	  	 	3,499	  	 	3,540	
Reinsurance recoverable on losses and loss expenses	  	 	14,225	  	 	14,354	
Other assets	  	 	15,141	  	 	11,907	
	  	 	 	  	 	 	
Total assets	  	$	75,155	  	$	72,090	
	  	 	 	  	 	 	
Liabilities	  			  			
Unpaid losses and loss expenses	  	$	38,373	  	$	37,112	
Unearned premium	  	 	6,459	  	 	6,227	
Other liabilities	  	 	14,967	  	 	12,074	
	  	 	 	  	 	 	
Total liabilities	  	$	59,799	  	$	55,413	
	  	 	 	  	 	 	
Shareholders’ equity	  			  			
Total shareholders’ equity	  	$	15,356	  	$	16,677	
	  	 	 	  	 	 	
Total liabilities and shareholders’ equity	  	$	75,155	  	$	72,090	
	  	 	 	  	 	 	
Book value per common share (3) 	  	$	46.06	  	$	48.89	
 
Page 5/7

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

   	  	Three Months Ended
September 30	 	 	Nine Months Ended
September 30	 	
 	  	2008	 	 	2007	 	 	2008	 	 	2007	 	
Gross premiums written	  	$	5,220	 	 	$	4,463	 	 	$	14,922	 	 	$	13,596	 	
Net premiums written	  	 	3,276	 	 	 	2,800	 	 	 	10,028	 	 	 	9,152	 	
Net premiums earned	  	 	3,609	 	 	 	3,150	 	 	 	9,977	 	 	 	9,240	 	
					
Losses and loss expenses	  	 	2,369	 	 	 	1,910	 	 	 	5,843	 	 	 	5,563	 	
Future policy benefits	  	 	91	 	 	 	39	 	 	 	243	 	 	 	108	 	
Policy acquisition costs	  	 	581	 	 	 	463	 	 	 	1,618	 	 	 	1,314	 	
Administrative expenses	  	 	457	 	 	 	358	 	 	 	1,293	 	 	 	1,070	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (1)	  	 	111	 	 	 	380	 	 	 	980	 	 	 	1,185	 	
					
Net investment income	  	 	520	 	 	 	492	 	 	 	1,541	 	 	 	1,414	 	
Net realized gains (losses)	  	 	(510	)	 	 	—  	 	 	 	(989	)	 	 	5	 	
Interest expense	  	 	68	 	 	 	44	 	 	 	176	 	 	 	132	 	
Other income (expense)	  	 	(6	)	 	 	(32	)	 	 	104	 	 	 	(32	)	
Income tax expense (benefit)	  	 	(7	)	 	 	140	 	 	 	283	 	 	 	434	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	 	54	 	 	 	656	 	 	 	1,177	 	 	 	2,006	 	
Preference shares dividend	  	 	—  	 	 	 	(11	)	 	 	(24	)	 	 	(33	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income available to holders of common shares	  	$	54	 	 	$	645	 	 	$	1,153	 	 	$	1,973	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Diluted earnings per share:	  				 				 				 				
Income excluding net realized gains (losses) (1)	  	$	1.51	 	 	$	2.06	 	 	$	5.84	 	 	$	6.02	 	
Net income	  	$	0.16	 	 	$	1.95	 	 	$	3.46	 	 	$	5.98	 	
					
Weighted average diluted shares outstanding	  	 	333.0	 	 	 	330.6	 	 	 	332.7	 	 	 	330.1	 	
					
Loss and loss expense ratio	  	 	69.5	%	 	 	62.5	%	 	 	61.5	%	 	 	62.0	%	
Policy acquisition cost ratio	  	 	16.3	%	 	 	14.7	%	 	 	16.3	%	 	 	14.3	%	
Administrative expense ratio	  	 	12.1	%	 	 	11.3	%	 	 	12.6	%	 	 	11.5	%	
Combined ratio	  	 	97.9	%	 	 	88.5	%	 	 	90.4	%	 	 	87.8	%	
 
Page 6/7

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

 	  	Three Months Ended
September 30	 	 	Nine Months Ended
September 30	 	
 	  	2008	 	 	2007	 	 	2008	 	 	2007	 	
Gross Premiums Written	  				 				 				 				
North American	  	$	2,987	 	 	$	2,708	 	 	$	7,886	 	 	$	7,566	 	
Overseas General	  	 	1,678	 	 	 	1,427	 	 	 	5,332	 	 	 	4,707	 	
Global Reinsurance	  	 	174	 	 	 	228	 	 	 	791	 	 	 	1,041	 	
Life	  	 	381	 	 	 	100	 	 	 	913	 	 	 	282	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	5,220	 	 	$	4,463	 	 	$	14,922	 	 	$	13,596	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net Premiums Written	  				 				 				 				
North American	  	$	1,461	 	 	$	1,449	 	 	$	4,332	 	 	$	4,460	 	
Overseas General	  	 	1,293	 	 	 	1,041	 	 	 	4,081	 	 	 	3,399	 	
Global Reinsurance	  	 	174	 	 	 	215	 	 	 	788	 	 	 	1,023	 	
Life	  	 	348	 	 	 	95	 	 	 	827	 	 	 	270	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	3,276	 	 	$	2,800	 	 	$	10,028	 	 	$	9,152	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net Premiums Earned	  				 				 				 				
North American	  	$	1,583	 	 	$	1,595	 	 	$	4,302	 	 	$	4,589	 	
Overseas General	  	 	1,425	 	 	 	1,141	 	 	 	4,087	 	 	 	3,394	 	
Global Reinsurance	  	 	257	 	 	 	319	 	 	 	777	 	 	 	987	 	
Life	  	 	344	 	 	 	95	 	 	 	811	 	 	 	270	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	3,609	 	 	$	3,150	 	 	$	9,977	 	 	$	9,240	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income Excluding Net Realized Gains (Losses) (1) 	  				 				 				 				
North American	  	$	153	 	 	$	312	 	 	$	789	 	 	$	940	 	
Overseas General	  	 	252	 	 	 	210	 	 	 	787	 	 	 	608	 	
Global Reinsurance	  	 	93	 	 	 	142	 	 	 	385	 	 	 	413	 	
Life	  	 	66	 	 	 	47	 	 	 	164	 	 	 	133	 	
Corporate	  	 	(60	)	 	 	(19	)	 	 	(158	)	 	 	(75	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	504	 	 	$	692	 	 	$	1,967	 	 	$	2,019	 	

Page 7/7

Exhibit 99.2

 

			
		
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:
 
Any 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 continued adverse economic and insurance industry developments such as those of recent weeks, as well as 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, worldwide and national economic and stock market conditions, rating agency action, investment portfolio performance, possible terrorism or the outbreak and effects of war, integration of recent acquisitions, or unexpected effects or difficulties relating to the Company’s recent re-domestication to Switzerland. 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 and Income Excluding Net Realized Gains (Losses) by Line of Business	  	4	
	  	- Consolidating Statement of Operations	  	5-6	
	  	- Catastrophe Loss Charges	  	7	
			
III.	  	Segment Results	  		
	  	- Insurance - North American	  	8	
	  	- Insurance - Overseas General	  	9	
	  	- Global Reinsurance	  	10	
	  	- Life Insurance and Reinsurance	  	11-12	
			
IV.	  	Balance Sheet Details	  		
	  	- Loss Reserve Rollforward	  	13	
	  	- Reinsurance Recoverable Analysis	  	14 -16	
	  	- Investment Portfolio	  	17 -24	
	  	- Net Realized and Unrealized Gains (Losses)	  	25	
	  	- Capital Structure	  	26 -27	
	  	- Computation of Basic and Diluted Earnings Per Share	  	28	
			
V.	  	Other Disclosures	  		
	  	- Non-GAAP Financial Measures	  	29	
	  	- Book Value per Common Share	  	30	
	  	- Comprehensive Income	  	31	
	  	- Glossary	  	32	

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

 	  	Three months ended September 30	 	 	 	 	 	Nine months ended September 30	 	 	 	 	
 	  	2008	 	 	2007	 	 	% Change
3Q-08 vs.
3Q-07	 	 	2008	 	 	2007	 	 	% Change
YTD-08 vs.
YTD-07	 	
Gross premiums written	  	$	5,220	 	 	$	4,463	 	 	17	%	 	$	14,922	 	 	$	13,596	 	 	10	%	
							
Net premiums written	  	$	3,276	 	 	$	2,800	 	 	17	%	 	$	10,028	 	 	$	9,152	 	 	10	%	
							
Net premiums earned	  	$	3,609	 	 	$	3,150	 	 	15	%	 	$	9,977	 	 	$	9,240	 	 	8	%	
							
Net investment income	  	$	520	 	 	$	492	 	 	6	%	 	$	1,541	 	 	$	1,414	 	 	9	%	
							
Net income	  	$	54	 	 	$	656	 	 	-92	%	 	$	1,177	 	 	$	2,006	 	 	-41	%	
							
Income excluding net realized gains (losses) (1)	  	$	504	 	 	$	692	 	 	-27	%	 	$	1,967	 	 	$	2,019	 	 	-3	%	
							
Comprehensive income (loss)	  	$	(915	)	 	$	909	 	 	NM	 	 	$	(609	)	 	$	1,958	 	 	NM	 	
							
Operating cash flow	  	$	1,058	 	 	$	1,484	 	 	-30	%	 	$	3,140	 	 	$	3,878	 	 	-20	%	
							
Combined ratio	  				 				 			 				 				 			
Loss and loss expense ratio	  	 	69.5	%	 	 	62.5	%	 			 	 	61.5	%	 	 	62.0	%	 			
Underwriting and administrative expense ratio	  	 	28.4	%	 	 	26.0	%	 			 	 	28.9	%	 	 	25.8	%	 			
	  	 	 	 	 	 	 	 	 			 	 	 	 	 	 	 	 	 			
Combined ratio	  	 	97.9	%	 	 	88.5	%	 			 	 	90.4	%	 	 	87.8	%	 			
							
Annualized ROE*	  	 	12.7	%	 	 	18.1	%	 			 	 	16.5	%	 	 	18.1	%	 			
Annualized ROE, excluding FAS 115*	  	 	12.2	%	 	 	18.6	%	 			 	 	16.2	%	 	 	18.8	%	 			
							
Effective tax rate on income excluding net realized gains (losses)	  	 	13	%	 	 	17	%	 			 	 	17	%	 	 	18	%	 			
							
Diluted earnings per share	  				 				 			 				 				 			
Income excluding net realized gains (losses) (1)	  	$	1.51	 	 	$	2.06	 	 	-27	%	 	$	5.84	 	 	$	6.02	 	 	-3	%	
Net income	  	$	0.16	 	 	$	1.95	 	 	-92	%	 	$	3.46	 	 	$	5.98	 	 	-42	%	
							
Book value per common share	  	$	46.06	 	 	$	46.98	 	 	-2	%	 	$	46.06	 	 	$	46.98	 	 	-2	%	
Tangible book value per common share	  	$	34.61	 	 	$	38.69	 	 	-11	%	 	$	34.61	 	 	$	38.69	 	 	-11	%	
							
Weighted average basic common shares outstanding	  	 	329.0	 	 	 	325.2	 	 			 	 	328.3	 	 	 	324.7	 	 			
Weighted average diluted common shares outstanding	  	 	333.0	 	 	 	330.6	 	 			 	 	332.7	 	 	 	330.1	 	 			
Debt/total capitalization	  	 	17.6	%	 	 	11.6	%	 			 	 	17.6	%	 	 	11.6	%	 			
 
(1)	See page 29 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

   	  	3Q-08	 	 	2Q-08	 	 	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	YTD
2008	 	 	YTD
2007	 	 	Full Year
2007	 	
Consolidated Results Excluding Life Segment	  				 				 				 				 				 				 				 				
Gross premiums written	  	$	4,839	 	 	$	4,866	 	 	$	4,304	 	 	$	4,035	 	 	$	4,363	 	 	$	14,009	 	 	$	13,314	 	 	$	17,349	 	
Net premiums written	  	 	2,928	 	 	 	3,224	 	 	 	3,049	 	 	 	2,716	 	 	 	2,705	 	 	 	9,201	 	 	 	8,882	 	 	 	11,598	 	
Net premiums earned	  	 	3,265	 	 	 	3,061	 	 	 	2,840	 	 	 	2,959	 	 	 	3,055	 	 	 	9,166	 	 	 	8,970	 	 	 	11,929	 	
Losses and loss expenses	  	 	2,265	 	 	 	1,785	 	 	 	1,579	 	 	 	1,788	 	 	 	1,910	 	 	 	5,629	 	 	 	5,563	 	 	 	7,351	 	
Future policy benefits	  	 	5	 	 	 	5	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	10	 	 	 	—  	 	 	 	—  	 	
Policy acquisition costs	  	 	533	 	 	 	506	 	 	 	460	 	 	 	448	 	 	 	450	 	 	 	1,499	 	 	 	1,278	 	 	 	1,726	 	
Administrative expenses	  	 	396	 	 	 	392	 	 	 	362	 	 	 	372	 	 	 	345	 	 	 	1,150	 	 	 	1,033	 	 	 	1,405	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income excluding life segment	  	$	66	 	 	$	373	 	 	$	439	 	 	$	351	 	 	$	350	 	 	$	878	 	 	$	1,096	 	 	$	1,447	 	
Life underwriting income excluding investment income	  	 	45	 	 	 	41	 	 	 	16	 	 	 	16	 	 	 	30	 	 	 	102	 	 	 	89	 	 	 	105	 	
Net investment income	  	 	520	 	 	 	532	 	 	 	489	 	 	 	504	 	 	 	492	 	 	 	1,541	 	 	 	1,414	 	 	 	1,918	 	
Net realized gains (losses)	  	 	(510	)	 	 	(126	)	 	 	(353	)	 	 	(66	)	 	 	—  	 	 	 	(989	)	 	 	5	 	 	 	(61	)	
Interest expense	  	 	68	 	 	 	62	 	 	 	46	 	 	 	43	 	 	 	44	 	 	 	176	 	 	 	132	 	 	 	175	 	
Other income (expense) (1)	  	 	(6	)	 	 	125	 	 	 	(15	)	 	 	(49	)	 	 	(32	)	 	 	104	 	 	 	(32	)	 	 	(81	)	
Income tax expense (benefit)	  	 	(7	)	 	 	137	 	 	 	153	 	 	 	141	 	 	 	140	 	 	 	283	 	 	 	434	 	 	 	575	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	$	54	 	 	$	746	 	 	$	377	 	 	$	572	 	 	$	656	 	 	$	1,177	 	 	$	2,006	 	 	$	2,578	 	
Net realized gains (losses)	  	 	(510	)	 	 	(126	)	 	 	(353	)	 	 	(66	)	 	 	—  	 	 	 	(989	)	 	 	5	 	 	 	(61	)	
Net realized gains (losses) in other income (expense) (1)	  	 	(23	)	 	 	120	 	 	 	(28	)	 	 	(57	)	 	 	(38	)	 	 	69	 	 	 	(38	)	 	 	(95	)	
Tax expense (benefit) on net realized gains (losses)	  	 	(83	)	 	 	(14	)	 	 	(33	)	 	 	(2	)	 	 	(2	)	 	 	(130	)	 	 	(20	)	 	 	(22	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) (2)	  	$	504	 	 	$	738	 	 	$	725	 	 	$	693	 	 	$	692	 	 	$	1,967	 	 	$	2,019	 	 	$	2,712	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
% Change versus prior year period (3) 	  				 				 				 				 				 				 				 				
Net premiums written	  	 	11	%	 	 	8	%	 	 	-4	%	 	 	-3	%	 	 	-1	%	 	 	4	%	 	 	-1	%	 	 	-1	%	
Net premiums earned	  	 	8	%	 	 	5	%	 	 	-5	%	 	 	0	%	 	 	1	%	 	 	2	%	 	 	4	%	 	 	3	%	
									
Other ratios	  				 				 				 				 				 				 				 				
Net premiums written/gross premiums written	  	 	61	%	 	 	66	%	 	 	71	%	 	 	67	%	 	 	62	%	 	 	66	%	 	 	67	%	 	 	67	%	
Effective tax rate on income excluding net realized gains (losses)	  	 	13	%	 	 	17	%	 	 	20	%	 	 	17	%	 	 	17	%	 	 	17	%	 	 	18	%	 	 	18	%	
									
Combined ratio (3) 	  				 				 				 				 				 				 				 				
Loss and loss expense ratio	  	 	69.5	%	 	 	58.5	%	 	 	55.6	%	 	 	60.4	%	 	 	62.5	%	 	 	61.5	%	 	 	62.0	%	 	 	61.6	%	
Policy acquisition cost ratio	  	 	16.3	%	 	 	16.5	%	 	 	16.2	%	 	 	15.1	%	 	 	14.7	%	 	 	16.3	%	 	 	14.3	%	 	 	14.5	%	
Administrative expense ratio	  	 	12.1	%	 	 	12.8	%	 	 	12.8	%	 	 	12.6	%	 	 	11.3	%	 	 	12.6	%	 	 	11.5	%	 	 	11.8	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Combined ratio	  	 	97.9	%	 	 	87.8	%	 	 	84.6	%	 	 	88.1	%	 	 	88.5	%	 	 	90.4	%	 	 	87.8	%	 	 	87.9	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Expense ratio	  	 	28.4	%	 	 	29.3	%	 	 	29.0	%	 	 	27.7	%	 	 	26.0	%	 	 	28.9	%	 	 	25.8	%	 	 	26.3	%	
Expense ratio excluding A&H	  	 	24.2	%	 	 	25.4	%	 	 	25.9	%	 	 	24.4	%	 	 	22.8	%	 	 	25.1	%	 	 	22.7	%	 	 	23.1	%	
									
Large losses and other items (3) 	  				 				 				 				 				 				 				 				
Catastrophe losses (before tax)	  	$	411	 	 	$	58	 	 	$	31	 	 	$	23	 	 	$	21	 	 	$	500	 	 	$	136	 	 	$	159	 	
Prior period development - unfavorable (favorable) (4)	  	$	(277	)	 	$	(104	)	 	$	(137	)	 	$	(89	)	 	$	(70	)	 	$	(518	)	 	$	(128	)	 	$	(217	)	
Loss and loss expense ratio excluding catastophe losses and prior period development	  	 	65.2	%	 	 	60.0	%	 	 	60.9	%	 	 	62.7	%	 	 	64.2	%	 	 	62.1	%	 	 	61.9	%	 	 	62.1	%	
 
(1)	Net realized investment and derivative losses related to our unconsolidated insurance affiliates.	
 
(2)	See page 29 Non-GAAP Financial Measures.	
 
(3) Presented excluding the Life segment to allow for comparison and analysis with earnings guidance. This is a non-GAAP measure.
 
(4)	For Q1 08, 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)	  		

 	  	September 30
2008	 	 	June 30
2008	 	 	March 31
2008	  	December 31
2007	
 	  	(Unaudited)	 	 	(Unaudited)	 	 	(Unaudited)	  	(Audited)	
Assets	  				 				 			  			
Fixed maturities available for sale, at fair value	  	$	33,158	 	 	$	34,870	 	 	$	32,619	  	$	33,184	
Fixed maturities held to maturity, at amortized cost	  	 	2,881	 	 	 	2,932	 	 	 	2,913	  	 	2,987	
Equity securities, at fair value	  	 	1,229	 	 	 	1,490	 	 	 	1,660	  	 	1,837	
Short-term investments, at fair value	  	 	3,014	 	 	 	3,137	 	 	 	4,795	  	 	2,631	
Other investments	  	 	1,529	 	 	 	1,414	 	 	 	1,243	  	 	1,140	
	  	 	 	 	 	 	 	 	 	 	 	  	 	 	
Total investments	  	 	41,811	 	 	 	43,843	 	 	 	43,230	  	 	41,779	
					
Cash	  	 	479	 	 	 	582	 	 	 	511	  	 	510	
Securities lending collateral	  	 	2,050	 	 	 	2,118	 	 	 	2,361	  	 	2,109	
Insurance and reinsurance balances receivable	  	 	3,499	 	 	 	4,086	 	 	 	3,748	  	 	3,540	
Reinsurance recoverable on losses and loss expenses	  	 	14,225	 	 	 	13,839	 	 	 	13,937	  	 	14,354	
Deferred policy acquisition costs	  	 	1,263	 	 	 	1,292	 	 	 	1,220	  	 	1,121	
Value of business acquired	  	 	923	 	 	 	1,288	 	 	 	—  	  	 	—  	
Prepaid reinsurance premiums	  	 	1,770	 	 	 	1,964	 	 	 	1,742	  	 	1,600	
Goodwill and other intangible assets	  	 	3,817	 	 	 	3,612	 	 	 	2,879	  	 	2,838	
Deferred tax assets	  	 	1,457	 	 	 	1,029	 	 	 	1,054	  	 	1,087	
Investments in partially owned insurance companies	  	 	867	 	 	 	900	 	 	 	776	  	 	773	
Other assets	  	 	2,994	 	 	 	3,223	 	 	 	2,461	  	 	2,379	
	  	 	 	 	 	 	 	 	 	 	 	  	 	 	
Total assets	  	$	75,155	 	 	$	77,776	 	 	$	73,919	  	$	72,090	
	  	 	 	 	 	 	 	 	 	 	 	  	 	 	
Liabilities	  				 				 			  			
Unpaid losses and loss expenses	  	$	38,373	 	 	$	37,696	 	 	$	37,182	  	$	37,112	
Unearned premiums	  	 	6,459	 	 	 	7,054	 	 	 	6,653	  	 	6,227	
Future policy benefits	  	 	2,919	 	 	 	2,948	 	 	 	632	  	 	545	
Insurance and reinsurance balances payable	  	 	2,754	 	 	 	2,991	 	 	 	2,756	  	 	2,843	
Securities lending payable	  	 	2,095	 	 	 	2,118	 	 	 	2,361	  	 	2,109	
Payable for securities purchased	  	 	1,008	 	 	 	1,802	 	 	 	1,391	  	 	1,798	
Accounts payable, accrued expenses, and other liabilities	  	 	2,547	 	 	 	2,473	 	 	 	2,445	  	 	2,287	
Short-term debt	  	 	333	 	 	 	1,050	 	 	 	1,341	  	 	372	
Long-term debt	  	 	3,002	 	 	 	3,008	 	 	 	2,114	  	 	1,811	
Trust preferred securities	  	 	309	 	 	 	309	 	 	 	309	  	 	309	
	  	 	 	 	 	 	 	 	 	 	 	  	 	 	
Total liabilities	  	 	59,799	 	 	 	61,449	 	 	 	57,184	  	 	55,413	
					
Shareholders’ equity	  				 				 			  			
Total shareholders’ equity, excl. AOCI	  	 	16,379	 	 	 	16,381	 	 	 	16,261	  	 	15,908	
Accumulated other comprehensive income (AOCI)	  	 	(1,023	)	 	 	(54	)	 	 	474	  	 	769	
	  	 	 	 	 	 	 	 	 	 	 	  	 	 	
Total shareholders’ equity	  	 	15,356	 	 	 	16,327	 	 	 	16,735	  	 	16,677	
	  	 	 	 	 	 	 	 	 	 	 	  	 	 	
Total liabilities and shareholders’ equity	  	$	75,155	 	 	$	77,776	 	 	$	73,919	  	$	72,090	
	  	 	 	 	 	 	 	 	 	 	 	  	 	 	
Book value per common share (1) 	  	$	46.06	 	 	$	48.99	 	 	$	48.65	  	$	48.89	
Tangible book value per common share (1) 	  	$	34.61	 	 	$	38.15	 	 	$	40.00	  	$	40.28	
 
(1)	See page 29 Non-GAAP Financial Measures.	

Consol Bal Sheet	  	Page 3	

					
	  	ACE Limited
Consolidated Premiums and Income excluding Net Realized Gains (Losses) by Line of Business
(in millions of U.S. dollars)
(Unaudited)	  		
 
ACE Limited Consolidated

 	  	3Q-08	 	% of
Total
Consolidated	 	 	3Q-07	  	% of
Total
Consolidated	 	 	% Change
3Q-08 vs.
3Q-07	 	 	YTD
2008	  	% of
Total
Consolidated	 	 	YTD
2007	  	% of
Total
Consolidated	 	 	% Change
YTD-08 vs.
YTD-07	 	
Net premiums written	  			 			 			  			 			 			  			 			  			 			
Property and all other	  	$	1,048	 	32	%	 	$	941	  	34	%	 	11	%	 	$	3,232	  	32	%	 	$	2,952	  	32	%	 	9	%	
Casualty	  	 	1,291	 	39	%	 	 	1,371	  	49	%	 	-6	%	 	 	4,253	  	42	%	 	 	4,697	  	51	%	 	-9	%	
	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Subtotal	  	 	2,339	 	71	%	 	 	2,312	  	83	%	 	1	%	 	 	7,485	  	74	%	 	 	7,649	  	83	%	 	-2	%	
Personal accident (A&H)  (1)	  	 	815	 	25	%	 	 	393	  	14	%	 	107	%	 	 	2,193	  	22	%	 	 	1,233	  	14	%	 	78	%	
Life (2)	  	 	122	 	4	%	 	 	95	  	3	%	 	28	%	 	 	350	  	4	%	 	 	270	  	3	%	 	30	%	
	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Total Consolidated	  	$	3,276	 	100	%	 	$	2,800	  	100	%	 	17	%	 	$	10,028	  	100	%	 	$	9,152	  	100	%	 	10	%	
	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Net premiums earned	  			 			 			  			 			 			  			 			  			 			
Property and all other	  	$	1,190	 	33	%	 	$	1,066	  	34	%	 	12	%	 	$	3,030	  	30	%	 	$	2,848	  	31	%	 	6	%	
Casualty	  	 	1,463	 	41	%	 	 	1,577	  	50	%	 	-7	%	 	 	4,435	  	45	%	 	 	4,908	  	53	%	 	-10	%	
	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Subtotal	  	 	2,653	 	74	%	 	 	2,643	  	84	%	 	0	%	 	 	7,465	  	75	%	 	 	7,756	  	84	%	 	-4	%	
Personal accident (A&H)  (1)	  	 	845	 	23	%	 	 	412	  	13	%	 	105	%	 	 	2,181	  	22	%	 	 	1,214	  	13	%	 	80	%	
Life (2)	  	 	111	 	3	%	 	 	95	  	3	%	 	17	%	 	 	331	  	3	%	 	 	270	  	3	%	 	23	%	
	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Total Consolidated	  	$	3,609	 	100	%	 	$	3,150	  	100	%	 	15	%	 	$	9,977	  	100	%	 	$	9,240	  	100	%	 	8	%	
	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Income excluding net realized gains (losses)	  			 			 			  			 			 			  			 			  			 			
Property, casualty, and all other	  	$	353	 	70	%	 	$	569	  	82	%	 	-38	%	 	$	1,522	  	77	%	 	$	1,677	  	83	%	 	-9	%	
Personal accident (A&H) (1)	  	 	118	 	23	%	 	 	76	  	11	%	 	55	%	 	 	340	  	17	%	 	 	209	  	10	%	 	63	%	
Life (2)	  	 	33	 	7	%	 	 	47	  	7	%	 	-30	%	 	 	105	  	6	%	 	 	133	  	7	%	 	-21	%	
	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Total Consolidated	  	$	504	 	100	%	 	$	692	  	100	%	 	-27	%	 	$	1,967	  	100	%	 	$	2,019	  	100	%	 	-3	%	

(1)	Consolidated A&H includes Combined Insurance which is reported in the Insurance - Overseas General and Life Insurance and Reinsurance segments.	
 
(2)	Excludes the North America A&H business from Combined Insurance which is included in the Life Insurance and Reinsurance segment.	

Line of Business	  	Page 4	

					
	  	ACE Limited
Consolidating Statement of Operations
Three months ended September 30, 2008 and 2007
(in millions of U.S. dollars)
(Unaudited)	 		

 	  	Insurance -
North
American	 	 	Insurance -
Overseas
General	 	 	Global
Reinsurance	 	 	Corporate
& Other	 	 	Consolidated
Excluding
Life Segment	 	 	Life Insurance
& Reinsurance	 	 	ACE
Consolidated	 	
September 30, 2008	  				 				 				 				 				 				 				
Gross premiums written	  	$	2,987	 	 	$	1,678	 	 	$	174	 	 	$	—  	 	 	$	4,839	 	 	$	381	 	 	$	5,220	 	
Net premiums written	  	 	1,461	 	 	 	1,293	 	 	 	174	 	 	 	—  	 	 	 	2,928	 	 	 	348	 	 	 	3,276	 	
Net premiums earned	  	 	1,583	 	 	 	1,425	 	 	 	257	 	 	 	—  	 	 	 	3,265	 	 	 	344	 	 	 	3,609	 	
Losses and loss expenses	  	 	1,356	 	 	 	731	 	 	 	178	 	 	 	—  	 	 	 	2,265	 	 	 	104	 	 	 	2,369	 	
Future policy benefits	  	 	—  	 	 	 	5	 	 	 	—  	 	 	 	—  	 	 	 	5	 	 	 	86	 	 	 	91	 	
Policy acquisition costs	  	 	160	 	 	 	329	 	 	 	44	 	 	 	—  	 	 	 	533	 	 	 	48	 	 	 	581	 	
Administrative expenses	  	 	132	 	 	 	217	 	 	 	14	 	 	 	33	 	 	 	396	 	 	 	61	 	 	 	457	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (loss)	  	 	(65	)	 	 	143	 	 	 	21	 	 	 	(33	)	 	 	66	 	 	 	45	 	 	 	111	 	
								
Net investment income	  	 	278	 	 	 	136	 	 	 	83	 	 	 	(17	)	 	 	480	 	 	 	40	 	 	 	520	 	
Net realized gains (losses)	  	 	(284	)	 	 	(58	)	 	 	(2	)	 	 	14	 	 	 	(330	)	 	 	(180	)	 	 	(510	)	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	68	 	 	 	68	 	 	 	—  	 	 	 	68	 	
Other income (expense)	  	 	(3	)	 	 	(6	)	 	 	(1	)	 	 	6	 	 	 	(4	)	 	 	(2	)	 	 	(6	)	
Income tax expense (benefit)	  	 	(7	)	 	 	10	 	 	 	9	 	 	 	(34	)	 	 	(22	)	 	 	15	 	 	 	(7	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income (loss)	  	 	(67	)	 	 	205	 	 	 	92	 	 	 	(64	)	 	 	166	 	 	 	(112	)	 	 	54	 	
								
Net realized gains (losses)	  	 	(284	)	 	 	(58	)	 	 	(2	)	 	 	14	 	 	 	(330	)	 	 	(180	)	 	 	(510	)	
Net realized gains (losses) in other
income (expense)	  	 	—  	 	 	 	(5	)	 	 	—  	 	 	 	(20	)	 	 	(25	)	 	 	2	 	 	 	(23	)	
Tax expense (benefit) on net realized gains (losses)	  	 	(64	)	 	 	(16	)	 	 	(1	)	 	 	(2	)	 	 	(83	)	 	 	—  	 	 	 	(83	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income (loss) excluding
net realized gains (losses) (1)	  	$	153	 	 	$	252	 	 	$	93	 	 	$	(60	)	 	$	438	 	 	$	66	 	 	$	504	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
September 30, 2007	  				 				 				 				 				 				 				
Gross premiums written	  	$	2,708	 	 	$	1,427	 	 	$	228	 	 	$	—  	 	 	$	4,363	 	 	$	100	 	 	$	4,463	 	
Net premiums written	  	 	1,449	 	 	 	1,041	 	 	 	215	 	 	 	—  	 	 	 	2,705	 	 	 	95	 	 	 	2,800	 	
Net premiums earned	  	 	1,595	 	 	 	1,141	 	 	 	319	 	 	 	—  	 	 	 	3,055	 	 	 	95	 	 	 	3,150	 	
Losses and loss expenses	  	 	1,138	 	 	 	611	 	 	 	161	 	 	 	—  	 	 	 	1,910	 	 	 	—  	 	 	 	1,910	 	
Future policy benefits	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	39	 	 	 	39	 	
Policy acquisition costs	  	 	150	 	 	 	240	 	 	 	60	 	 	 	—  	 	 	 	450	 	 	 	13	 	 	 	463	 	
Administrative expenses	  	 	129	 	 	 	170	 	 	 	14	 	 	 	32	 	 	 	345	 	 	 	13	 	 	 	358	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (loss)	  	 	178	 	 	 	120	 	 	 	84	 	 	 	(32	)	 	 	350	 	 	 	30	 	 	 	380	 	
								
Net investment income	  	 	260	 	 	 	116	 	 	 	69	 	 	 	33	 	 	 	478	 	 	 	14	 	 	 	492	 	
Net realized gains (losses)	  	 	29	 	 	 	(5	)	 	 	25	 	 	 	2	 	 	 	51	 	 	 	(51	)	 	 	—  	 	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	44	 	 	 	44	 	 	 	—  	 	 	 	44	 	
Other income (expense)	  	 	(1	)	 	 	12	 	 	 	—  	 	 	 	(43	)	 	 	(32	)	 	 	—  	 	 	 	(32	)	
Income tax expense (benefit)	  	 	125	 	 	 	26	 	 	 	11	 	 	 	(19	)	 	 	143	 	 	 	(3	)	 	 	140	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income (loss)	  	 	341	 	 	 	217	 	 	 	167	 	 	 	(65	)	 	 	660	 	 	 	(4	)	 	 	656	 	
								
Net realized gains (losses)	  	 	29	 	 	 	(5	)	 	 	25	 	 	 	2	 	 	 	51	 	 	 	(51	)	 	 	—  	 	
Net realized gains (losses) in other income (expense)	  	 	—  	 	 	 	11	 	 	 	—  	 	 	 	(49	)	 	 	(38	)	 	 	—  	 	 	 	(38	)	
Tax expense (benefit) on net realized gains (losses)	  	 	—  	 	 	 	(1	)	 	 	—  	 	 	 	(1	)	 	 	(2	)	 	 	—  	 	 	 	(2	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income (loss) excluding net realized gains (losses) (1)	  	$	312	 	 	$	210	 	 	$	142	 	 	$	(19	)	 	$	645	 	 	$	47	 	 	$	692	 	

(1)	See page 29 Non-GAAP Financial Measures.	

Segment 2008 Qtr	  	Page 5	

					
	 	ACE Limited
Consolidating Statement of Operations Nine months ended September 30, 2008 and 2007
(in millions of U.S. dollars)
(Unaudited)	 		

 	  	Insurance -
North
American	 	 	Insurance -
Overseas
General	 	 	Global
Reinsurance	 	 	Corporate
& Other	 	 	Consolidated
Excluding
Life Segment	 	 	Life Insurance
& Reinsurance	 	 	ACE
Consolidated	 	
September 30, 2008	  				 				 				 				 				 				 				
Gross premiums written	  	$	7,886	 	 	$	5,332	 	 	$	791	 	 	$	—  	 	 	$	14,009	 	 	$	913	 	 	$	14,922	 	
Net premiums written	  	 	4,332	 	 	 	4,081	 	 	 	788	 	 	 	—  	 	 	 	9,201	 	 	 	827	 	 	 	10,028	 	
Net premiums earned	  	 	4,302	 	 	 	4,087	 	 	 	777	 	 	 	—  	 	 	 	9,166	 	 	 	811	 	 	 	9,977	 	
Losses and loss expenses	  	 	3,187	 	 	 	2,039	 	 	 	403	 	 	 	—  	 	 	 	5,629	 	 	 	214	 	 	 	5,843	 	
Future policy benefits	  	 	—  	 	 	 	10	 	 	 	—  	 	 	 	—  	 	 	 	10	 	 	 	233	 	 	 	243	 	
Policy acquisition costs	  	 	450	 	 	 	897	 	 	 	152	 	 	 	—  	 	 	 	1,499	 	 	 	119	 	 	 	1,618	 	
Administrative expenses	  	 	398	 	 	 	598	 	 	 	43	 	 	 	111	 	 	 	1,150	 	 	 	143	 	 	 	1,293	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (loss)	  	 	267	 	 	 	543	 	 	 	179	 	 	 	(111	)	 	 	878	 	 	 	102	 	 	 	980	 	
								
Net investment income	  	 	829	 	 	 	387	 	 	 	235	 	 	 	(5	)	 	 	1,446	 	 	 	95	 	 	 	1,541	 	
Net realized gains (losses)	  	 	(450	)	 	 	(199	)	 	 	(67	)	 	 	29	 	 	 	(687	)	 	 	(302	)	 	 	(989	)	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	176	 	 	 	176	 	 	 	—  	 	 	 	176	 	
Other income (expense)	  	 	(6	)	 	 	14	 	 	 	(2	)	 	 	104	 	 	 	110	 	 	 	(6	)	 	 	104	 	
Income tax expense (benefit)	  	 	222	 	 	 	95	 	 	 	24	 	 	 	(83	)	 	 	258	 	 	 	25	 	 	 	283	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income (loss)	  	 	418	 	 	 	650	 	 	 	321	 	 	 	(76	)	 	 	1,313	 	 	 	(136	)	 	 	1,177	 	
								
Net realized gains (losses)	  	 	(450	)	 	 	(199	)	 	 	(67	)	 	 	29	 	 	 	(687	)	 	 	(302	)	 	 	(989	)	
Net realized gains (losses) in other income (expense)	  	 	—  	 	 	 	17	 	 	 	—  	 	 	 	50	 	 	 	67	 	 	 	2	 	 	 	69	 	
Tax expense (benefit) on net realized gains (losses)	  	 	(79	)	 	 	(45	)	 	 	(3	)	 	 	(3	)	 	 	(130	)	 	 	—  	 	 	 	(130	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income (loss) excluding net realized gains (losses) (1)	  	$	789	 	 	$	787	 	 	$	385	 	 	$	(158	)	 	$	1,803	 	 	$	164	 	 	$	1,967	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
September 30, 2007	  				 				 				 				 				 				 				
Gross premiums written	  	$	7,566	 	 	$	4,707	 	 	$	1,041	 	 	$	—  	 	 	$	13,314	 	 	$	282	 	 	$	13,596	 	
Net premiums written	  	 	4,460	 	 	 	3,399	 	 	 	1,023	 	 	 	—  	 	 	 	8,882	 	 	 	270	 	 	 	9,152	 	
Net premiums earned	  	 	4,589	 	 	 	3,394	 	 	 	987	 	 	 	—  	 	 	 	8,970	 	 	 	270	 	 	 	9,240	 	
Losses and loss expenses	  	 	3,265	 	 	 	1,789	 	 	 	509	 	 	 	—  	 	 	 	5,563	 	 	 	—  	 	 	 	5,563	 	
Future policy benefits	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	108	 	 	 	108	 	
Policy acquisition costs	  	 	394	 	 	 	694	 	 	 	190	 	 	 	—  	 	 	 	1,278	 	 	 	36	 	 	 	1,314	 	
Administrative expenses	  	 	392	 	 	 	494	 	 	 	47	 	 	 	100	 	 	 	1,033	 	 	 	37	 	 	 	1,070	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (loss)	  	 	538	 	 	 	417	 	 	 	241	 	 	 	(100	)	 	 	1,096	 	 	 	89	 	 	 	1,185	 	
								
Net investment income	  	 	758	 	 	 	331	 	 	 	201	 	 	 	84	 	 	 	1,374	 	 	 	40	 	 	 	1,414	 	
Net realized gains (losses)	  	 	81	 	 	 	(58	)	 	 	24	 	 	 	14	 	 	 	61	 	 	 	(56	)	 	 	5	 	
Interest expense	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	132	 	 	 	132	 	 	 	—  	 	 	 	132	 	
Other income (expense)	  	 	(11	)	 	 	8	 	 	 	(3	)	 	 	(26	)	 	 	(32	)	 	 	—  	 	 	 	(32	)	
Income tax expense (benefit)	  	 	368	 	 	 	124	 	 	 	25	 	 	 	(79	)	 	 	438	 	 	 	(4	)	 	 	434	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income (loss)	  	 	998	 	 	 	574	 	 	 	438	 	 	 	(81	)	 	 	1,929	 	 	 	77	 	 	 	2,006	 	
								
Net realized gains (losses)	  	 	81	 	 	 	(58	)	 	 	24	 	 	 	14	 	 	 	61	 	 	 	(56	)	 	 	5	 	
Net realized gains (losses) in other income (expense)	  	 	—  	 	 	 	11	 	 	 	—  	 	 	 	(49	)	 	 	(38	)	 	 	—  	 	 	 	(38	)	
Tax expense (benefit) on net
realized gains (losses)	  	 	23	 	 	 	(13	)	 	 	(1	)	 	 	(29	)	 	 	(20	)	 	 	—  	 	 	 	(20	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income (loss) excluding net
realized gains (losses) (1)	  	$	940	 	 	$	608	 	 	$	413	 	 	$	(75	)	 	$	1,886	 	 	$	133	 	 	$	2,019	 	

(1)	See page 29 Non-GAAP Financial Measures.	

Segment 2008 YTD	  	Page 6	

					
	  	ACE Limited
Segment Results - Third Quarter Catastrophe Loss Charges
(in millions of U.S. dollars)
(Unaudited)	  		
 
Third Quarter Catastrophe Loss Charges - 2008

Catastrophe Loss Charges- By Event	  	Insurance -
North
American	 	 	Insurance -
Overseas
General	 	 	Global
Reinsurance	 	 	Total	 	 	Total impact
after income tax	 	
Gross loss	  				 				 				 	$	862	 	 				
Net loss	  				 				 				 				 				
Hurricane - Gustav	  	$	50	 	 	$	12	 	 	$	6	 	 	$	68	 	 	$	48	 	
Hurricane - Ike	  	 	206	 	 	 	49	 	 	 	106	 	 	 	361	 	 	 	281	 	
Other (1)	  	 	2	 	 	 	(12	)	 	 	(8	)	 	 	(18	)	 	 	(18	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	258	 	 	$	49	 	 	$	104	 	 	$	411	 	 	$	311	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Reinstatement premiums (earned) expensed	  	$	16	 	 	$	4	 	 	$	(13	)	 	 	7	 	 				
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 				
Net premium (earned) expensed	  	$	16	 	 	$	4	 	 	$	(13	)	 	$	7	 	 				
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 				
Total impact before income tax	  	$	274	 	 	$	53	 	 	$	91	 	 	$	418	 	 				
Income tax benefit	  	 	(86	)	 	 	(17	)	 	 	(4	)	 	 	(107	)	 				
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 				
Total impact after income tax	  	$	188	 	 	$	36	 	 	$	87	 	 	$	311	 	 				
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 				
Effective tax rate	  	 	31	%	 	 	32	%	 	 	4	%	 	 	26	%	 				
 
(1)	Includes adjustments to catastrophe losses reported in the second quarter of 2008 related to Midwest floods.	
 
Note: The catastrophe losses above include offshore energy gross and net losses of $32 million and $10 million primarily for hurricane Ike in Insurance - Overseas General.

Catastrophe Losses	  	Page 7	

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

 	  	3Q-08	 	 	2Q-08	 	 	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	YTD
2008	 	 	YTD
2007	 	 	Full Year
2007	 	
Gross premiums written	  	$	2,987	 	 	$	2,718	 	 	$	2,181	 	 	$	2,274	 	 	$	2,708	 	 	$	7,886	 	 	$	7,566	 	 	$	9,840	 	
Net premiums written	  	 	1,461	 	 	 	1,511	 	 	 	1,360	 	 	 	1,373	 	 	 	1,449	 	 	 	4,332	 	 	 	4,460	 	 	 	5,833	 	
Net premiums earned	  	 	1,583	 	 	 	1,365	 	 	 	1,354	 	 	 	1,418	 	 	 	1,595	 	 	 	4,302	 	 	 	4,589	 	 	 	6,007	 	
Losses and loss expenses	  	 	1,356	 	 	 	962	 	 	 	869	 	 	 	1,004	 	 	 	1,138	 	 	 	3,187	 	 	 	3,265	 	 	 	4,269	 	
Policy acquisition costs	  	 	160	 	 	 	129	 	 	 	161	 	 	 	121	 	 	 	150	 	 	 	450	 	 	 	394	 	 	 	515	 	
Administrative expenses	  	 	132	 	 	 	131	 	 	 	135	 	 	 	138	 	 	 	129	 	 	 	398	 	 	 	392	 	 	 	530	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income (loss)	  	 	(65	)	 	 	143	 	 	 	189	 	 	 	155	 	 	 	178	 	 	 	267	 	 	 	538	 	 	 	693	 	
Net investment income	  	 	278	 	 	 	282	 	 	 	269	 	 	 	276	 	 	 	260	 	 	 	829	 	 	 	758	 	 	 	1,034	 	
Net realized gains (losses)	  	 	(284	)	 	 	(105	)	 	 	(61	)	 	 	44	 	 	 	29	 	 	 	(450	)	 	 	81	 	 	 	125	 	
Other income (expense)	  	 	(3	)	 	 	(3	)	 	 	—  	 	 	 	—  	 	 	 	(1	)	 	 	(6	)	 	 	(11	)	 	 	(11	)	
Income tax expense (benefit)	  	 	(7	)	 	 	106	 	 	 	123	 	 	 	100	 	 	 	125	 	 	 	222	 	 	 	368	 	 	 	468	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income (loss)	  	 	(67	)	 	 	211	 	 	 	274	 	 	 	375	 	 	 	341	 	 	 	418	 	 	 	998	 	 	 	1,373	 	
Net realized gains (losses)	  	 	(284	)	 	 	(105	)	 	 	(61	)	 	 	44	 	 	 	29	 	 	 	(450	)	 	 	81	 	 	 	125	 	
Tax expense (benefit) on net realized gains (losses)	  	 	(64	)	 	 	(7	)	 	 	(8	)	 	 	(2	)	 	 	—  	 	 	 	(79	)	 	 	23	 	 	 	21	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains
(losses) (1)	  	$	153	 	 	$	309	 	 	$	327	 	 	$	329	 	 	$	312	 	 	$	789	 	 	$	940	 	 	$	1,269	 	

Combined ratio	  				 				 				 				 				 				 				 				
Loss and loss expense ratio	  	 	85.6	%	 	 	70.5	%	 	 	64.1	%	 	 	70.8	%	 	 	71.3	%	 	 	74.1	%	 	 	71.1	%	 	 	71.1	%	
Policy acquisition cost ratio	  	 	10.1	%	 	 	9.5	%	 	 	11.9	%	 	 	8.6	%	 	 	9.4	%	 	 	10.4	%	 	 	8.6	%	 	 	8.6	%	
Administrative expense ratio	  	 	8.4	%	 	 	9.5	%	 	 	10.0	%	 	 	9.7	%	 	 	8.1	%	 	 	9.3	%	 	 	8.5	%	 	 	8.8	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Combined ratio	  	 	104.1	%	 	 	89.5	%	 	 	86.0	%	 	 	89.1	%	 	 	88.8	%	 	 	93.8	%	 	 	88.2	%	 	 	88.5	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Large losses and other items (before tax)	  				 				 				 				 				 				 				 				
Catastrophe losses (before tax)	  	$	258	 	 	$	22	 	 	$	15	 	 	$	—  	 	 	$	—  	 	 	$	295	 	 	$	16	 	 	$	16	 	
Prior period development - unfavorable (favorable) (2)	  	$	(103	)	 	$	(23	)	 	$	(79	)	 	$	1	 	 	$	4	 	 	$	(205	)	 	$	8	 	 	$	9	 	
Loss and loss expense ratio excluding catastrophe losses and prior period development	  	 	75.1	%	 	 	70.6	%	 	 	72.1	%	 	 	70.8	%	 	 	71.0	%	 	 	72.7	%	 	 	70.6	%	 	 	70.6	%	
									
% Change versus prior year period	  				 				 				 				 				 				 				 				
Net premiums written	  	 	1	%	 	 	1	%	 	 	-10	%	 	 	-7	%	 	 	-1	%	 	 	-3	%	 	 	0	%	 	 	-2	%	
Net premiums earned	  	 	-1	%	 	 	-6	%	 	 	-12	%	 	 	-4	%	 	 	3	%	 	 	-6	%	 	 	8	%	 	 	5	%	
									
Other ratios	  				 				 				 				 				 				 				 				
Net premiums written/gross premiums written	  	 	49	%	 	 	56	%	 	 	62	%	 	 	60	%	 	 	54	%	 	 	55	%	 	 	59	%	 	 	59	%	
 
(1)	See page 29 Non-GAAP Financial Measures.	
 
(2)	For Q1 2008 prior period favorable development of $123 million less $44 million of profit share commission on Crop business settlement.	

Insurance - North American	  	Page 8	

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

 	  	3Q-08  (2)	 	 	2Q-08  (2)	 	 	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	YTD
2008	 	 	YTD
2007	 	 	Full Year
2007	 	
Gross premiums written	  	$	1,678	 	 	$	1,876	 	 	$	1,778	 	 	$	1,584	 	 	$	1,427	 	 	$	5,332	 	 	$	4,707	 	 	$	6,291	 	
Net premiums written	  	 	1,293	 	 	 	1,443	 	 	 	1,345	 	 	 	1,169	 	 	 	1,041	 	 	 	4,081	 	 	 	3,399	 	 	 	4,568	 	
Net premiums earned	  	 	1,425	 	 	 	1,439	 	 	 	1,223	 	 	 	1,229	 	 	 	1,141	 	 	 	4,087	 	 	 	3,394	 	 	 	4,623	 	
Losses and loss expenses	  	 	731	 	 	 	715	 	 	 	593	 	 	 	631	 	 	 	611	 	 	 	2,039	 	 	 	1,789	 	 	 	2,420	 	
Future policy benefits	  	 	5	 	 	 	5	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	10	 	 	 	—  	 	 	 	—  	 	
Policy acquisition costs	  	 	329	 	 	 	323	 	 	 	245	 	 	 	269	 	 	 	240	 	 	 	897	 	 	 	694	 	 	 	963	 	
Administrative expenses	  	 	217	 	 	 	208	 	 	 	173	 	 	 	175	 	 	 	170	 	 	 	598	 	 	 	494	 	 	 	669	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income	  	 	143	 	 	 	188	 	 	 	212	 	 	 	154	 	 	 	120	 	 	 	543	 	 	 	417	 	 	 	571	 	
Net investment income	  	 	136	 	 	 	134	 	 	 	117	 	 	 	119	 	 	 	116	 	 	 	387	 	 	 	331	 	 	 	450	 	
Net realized gains (losses)	  	 	(58	)	 	 	(58	)	 	 	(83	)	 	 	(11	)	 	 	(5	)	 	 	(199	)	 	 	(58	)	 	 	(69	)	
Other income (expense)	  	 	(6	)	 	 	17	 	 	 	3	 	 	 	12	 	 	 	12	 	 	 	14	 	 	 	8	 	 	 	20	 	
Income tax expense (benefit)	  	 	10	 	 	 	38	 	 	 	47	 	 	 	59	 	 	 	26	 	 	 	95	 	 	 	124	 	 	 	183	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	 	205	 	 	 	243	 	 	 	202	 	 	 	215	 	 	 	217	 	 	 	650	 	 	 	574	 	 	 	789	 	
Net realized gains (losses)	  	 	(58	)	 	 	(58	)	 	 	(83	)	 	 	(11	)	 	 	(5	)	 	 	(199	)	 	 	(58	)	 	 	(69	)	
Net realized gains (losses) in other income (expense)	  	 	(5	)	 	 	15	 	 	 	7	 	 	 	15	 	 	 	11	 	 	 	17	 	 	 	11	 	 	 	26	 	
Tax expense (benefit) on net realized gains (losses)	  	 	(16	)	 	 	(7	)	 	 	(22	)	 	 	(1	)	 	 	(1	)	 	 	(45	)	 	 	(13	)	 	 	(14	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) (1)	  	$	252	 	 	$	279	 	 	$	256	 	 	$	210	 	 	$	210	 	 	$	787	 	 	$	608	 	 	$	818	 	

Combined ratio	  				 				 				 				 				 				 				 				
Loss and loss expense ratio	  	 	51.6	%	 	 	50.0	%	 	 	48.5	%	 	 	51.4	%	 	 	53.6	%	 	 	50.1	%	 	 	52.7	%	 	 	52.4	%	
Policy acquisition cost ratio	  	 	23.1	%	 	 	22.4	%	 	 	20.0	%	 	 	21.8	%	 	 	21.1	%	 	 	22.0	%	 	 	20.5	%	 	 	20.8	%	
Administrative expense ratio	  	 	15.2	%	 	 	14.5	%	 	 	14.2	%	 	 	14.3	%	 	 	14.8	%	 	 	14.6	%	 	 	14.5	%	 	 	14.5	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Combined ratio	  	 	89.9	%	 	 	86.9	%	 	 	82.7	%	 	 	87.5	%	 	 	89.5	%	 	 	86.7	%	 	 	87.7	%	 	 	87.7	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Large losses and other items	  				 				 				 				 				 				 				 				
Catastrophe losses (before tax)	  	$	49	 	 	$	25	 	 	$	15	 	 	$	13	 	 	$	8	 	 	$	89	 	 	$	81	 	 	$	94	 	
Prior period development - unfavorable (favorable)	  	$	(121	)	 	$	(54	)	 	$	(44	)	 	$	(76	)	 	$	(64	)	 	$	(219	)	 	$	(116	)	 	$	(192	)	
Loss and loss expense ratio excluding catastophe losses and prior period development	  	 	56.7	%	 	 	52.0	%	 	 	50.9	%	 	 	56.5	%	 	 	58.5	%	 	 	53.3	%	 	 	53.6	%	 	 	54.4	%	
									
% Change versus prior year period	  				 				 				 				 				 				 				 				
Net premiums written	  	 	24	%	 	 	24	%	 	 	13	%	 	 	10	%	 	 	6	%	 	 	20	%	 	 	6	%	 	 	7	%	
Net premiums earned	  	 	25	%	 	 	26	%	 	 	10	%	 	 	12	%	 	 	4	%	 	 	20	%	 	 	5	%	 	 	7	%	
									
Other ratios	  				 				 				 				 				 				 				 				
Net premiums written/gross premiums written	  	 	77	%	 	 	77	%	 	 	76	%	 	 	74	%	 	 	73	%	 	 	77	%	 	 	72	%	 	 	73	%	
 
(1)	See page 29 Non-GAAP Financial Measures.	
 
(2)	Includes the International operations of Combined Insurance.	

Insurance - Overseas General	  	Page 9	

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

 	  	3Q-08	 	 	2Q-08	 	 	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	YTD
2008	 	 	YTD
2007	 	 	Full Year
2007	 	
Gross premiums written	  	$	174	 	 	$	272	 	 	$	345	 	 	$	177	 	 	$	228	 	 	$	791	 	 	$	1,041	 	 	$	1,218	 	
Net premiums written	  	 	174	 	 	 	270	 	 	 	344	 	 	 	174	 	 	 	215	 	 	 	788	 	 	 	1,023	 	 	 	1,197	 	
Net premiums earned	  	 	257	 	 	 	257	 	 	 	263	 	 	 	312	 	 	 	319	 	 	 	777	 	 	 	987	 	 	 	1,299	 	
Losses and loss expenses	  	 	178	 	 	 	108	 	 	 	117	 	 	 	155	 	 	 	161	 	 	 	403	 	 	 	509	 	 	 	664	 	
Policy acquisition costs	  	 	44	 	 	 	54	 	 	 	54	 	 	 	58	 	 	 	60	 	 	 	152	 	 	 	190	 	 	 	248	 	
Administrative expenses	  	 	14	 	 	 	14	 	 	 	15	 	 	 	17	 	 	 	14	 	 	 	43	 	 	 	47	 	 	 	64	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Underwriting income	  	 	21	 	 	 	81	 	 	 	77	 	 	 	82	 	 	 	84	 	 	 	179	 	 	 	241	 	 	 	323	 	
Net investment income	  	 	83	 	 	 	79	 	 	 	73	 	 	 	73	 	 	 	69	 	 	 	235	 	 	 	201	 	 	 	274	 	
Net realized gains (losses)	  	 	(2	)	 	 	(20	)	 	 	(45	)	 	 	(3	)	 	 	25	 	 	 	(67	)	 	 	24	 	 	 	21	 	
Other income (expense)	  	 	(1	)	 	 	(1	)	 	 	—  	 	 	 	(1	)	 	 	—  	 	 	 	(2	)	 	 	(3	)	 	 	(4	)	
Income tax expense (benefit)	  	 	9	 	 	 	11	 	 	 	4	 	 	 	7	 	 	 	11	 	 	 	24	 	 	 	25	 	 	 	32	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	 	92	 	 	 	128	 	 	 	101	 	 	 	144	 	 	 	167	 	 	 	321	 	 	 	438	 	 	 	582	 	
Net realized gains (losses)	  	 	(2	)	 	 	(20	)	 	 	(45	)	 	 	(3	)	 	 	25	 	 	 	(67	)	 	 	24	 	 	 	21	 	
Tax expense (benefit) on net realized gains (losses)	  	 	(1	)	 	 	—  	 	 	 	(2	)	 	 	(1	)	 	 	—  	 	 	 	(3	)	 	 	(1	)	 	 	(2	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses) (1)	  	$	93	 	 	$	148	 	 	$	144	 	 	$	146	 	 	$	142	 	 	$	385	 	 	$	413	 	 	$	559	 	

Combined ratio	  				 				 				 				 				 				 				 				
Loss and loss expense ratio	  	 	69.2	%	 	 	42.1	%	 	 	44.5	%	 	 	49.8	%	 	 	50.6	%	 	 	51.9	%	 	 	51.6	%	 	 	51.1	%	
Policy acquisition cost ratio	  	 	16.9	%	 	 	21.0	%	 	 	20.6	%	 	 	18.3	%	 	 	18.8	%	 	 	19.5	%	 	 	19.3	%	 	 	19.1	%	
Administrative expense ratio	  	 	5.4	%	 	 	5.5	%	 	 	5.7	%	 	 	5.5	%	 	 	4.2	%	 	 	5.5	%	 	 	4.7	%	 	 	4.9	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Combined ratio	  	 	91.5	%	 	 	68.6	%	 	 	70.8	%	 	 	73.6	%	 	 	73.6	%	 	 	76.9	%	 	 	75.6	%	 	 	75.1	%	

Large losses and other items	  				 				 				 				 				 				 				 				
Catastrophe losses (before tax)	  	$	104	 	 	$	11	 	 	$	1	 	 	$	10	 	 	$	13	 	 	$	116	 	 	$	39	 	 	$	49	 	
Prior period development - unfavorable (favorable)	  	$	(53	)	 	$	(27	)	 	$	(14	)	 	$	(14	)	 	$	(10	)	 	$	(94	)	 	$	(20	)	 	$	(34	)	
Loss and loss expense ratio excluding catastophe losses and prior period development	  	 	50.7	%	 	 	48.2	%	 	 	49.5	%	 	 	51.2	%	 	 	49.6	%	 	 	49.5	%	 	 	49.8	%	 	 	50.0	%	
% Change versus prior year period	  				 				 				 				 				 				 				 				
Net premiums written	  	 	-19	%	 	 	-19	%	 	 	-28	%	 	 	-31	%	 	 	-24	%	 	 	-23	%	 	 	-21	%	 	 	-23	%	
Net premiums earned	  	 	-19	%	 	 	-21	%	 	 	-23	%	 	 	-18	%	 	 	-14	%	 	 	-21	%	 	 	-13	%	 	 	-14	%	
									
Other ratios	  				 				 				 				 				 				 				 				
Net premiums written/gross premiums written	  	 	100	%	 	 	99	%	 	 	100	%	 	 	98	%	 	 	94	%	 	 	100	%	 	 	98	%	 	 	98	%	
 
(1)	See page 29 Non-GAAP Financial Measures.	

Global Reinsurance 	  	Page 10	

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

 	  	3Q-08  (4)	 	 	2Q-08  (4)	 	 	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	YTD
2008	 	 	YTD
2007	 	 	Full Year
2007	 	
Gross premiums written (1)	  	$	381	 	 	$	427	 	 	$	105	 	 	$	109	 	 	$	100	 	 	$	913	 	 	$	282	 	 	$	391	 	
Net premiums written	  	 	348	 	 	 	374	 	 	 	105	 	 	 	111	 	 	 	95	 	 	 	827	 	 	 	270	 	 	 	381	 	
Net premiums earned	  	 	344	 	 	 	367	 	 	 	100	 	 	 	98	 	 	 	95	 	 	 	811	 	 	 	270	 	 	 	368	 	
Losses and loss expenses	  	 	104	 	 	 	110	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	214	 	 	 	—  	 	 	 	—  	 	
Future policy benefits	  	 	86	 	 	 	84	 	 	 	63	 	 	 	60	 	 	 	39	 	 	 	233	 	 	 	108	 	 	 	168	 	
Policy acquisition costs	  	 	48	 	 	 	63	 	 	 	8	 	 	 	9	 	 	 	13	 	 	 	119	 	 	 	36	 	 	 	45	 	
Administrative expenses	  	 	61	 	 	 	69	 	 	 	13	 	 	 	13	 	 	 	13	 	 	 	143	 	 	 	37	 	 	 	50	 	
Net investment income	  	 	40	 	 	 	40	 	 	 	15	 	 	 	15	 	 	 	14	 	 	 	95	 	 	 	40	 	 	 	55	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Life underwriting income (2)	  	 	85	 	 	 	81	 	 	 	31	 	 	 	31	 	 	 	44	 	 	 	197	 	 	 	129	 	 	 	160	 	
Net realized gains (losses)	  	 	(180	)	 	 	64	 	 	 	(186	)	 	 	(108	)	 	 	(51	)	 	 	(302	)	 	 	(56	)	 	 	(164	)	
Other income (expense)	  	 	(2	)	 	 	(4	)	 	 	—  	 	 	 	(1	)	 	 	—  	 	 	 	(6	)	 	 	—  	 	 	 	(1	)	
Income tax expense (benefit)	  	 	15	 	 	 	12	 	 	 	(2	)	 	 	(4	)	 	 	(3	)	 	 	25	 	 	 	(4	)	 	 	(8	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income (loss)	  	 	(112	)	 	 	129	 	 	 	(153	)	 	 	(74	)	 	 	(4	)	 	 	(136	)	 	 	77	 	 	 	3	 	
Net realized gains (losses)	  	 	(180	)	 	 	64	 	 	 	(186	)	 	 	(108	)	 	 	(51	)	 	 	(302	)	 	 	(56	)	 	 	(164	)	
Net realized gains (losses) in other income (expense)	  	 	2	 	 	 	—  	 	 	 	—  	 	 	 	1	 	 	 	—  	 	 	 	2	 	 	 	—  	 	 	 	1	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains
(losses) (3)	  	$	66	 	 	$	65	 	 	$	33	 	 	$	33	 	 	$	47	 	 	$	164	 	 	$	133	 	 	$	166	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
% Change versus prior year period	  				 				 				 				 				 				 				 				
Net premiums written	  	 	266	%	 	 	330	%	 	 	19	%	 	 	42	%	 	 	38	%	 	 	206	%	 	 	38	%	 	 	39	%	
Net premiums earned	  	 	262	%	 	 	322	%	 	 	14	%	 	 	26	%	 	 	38	%	 	 	200	%	 	 	38	%	 	 	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 September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007 and September 30, 2007, premiums or deposits collected on investment and universal life contracts that are excluded from premium revenue above aggregated $18.8 million, $30.9 million, $41.2 million, $27.2 million, and $17.4 million, respectively.	
 
(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 29 Non-GAAP Financial Measures.	
 
(4)	Includes the North America operations of Combined Insurance.	

Life	  	Page 11	

					
	  	ACE Limited
Segment Results -Life Reinsurance
(in millions of U.S. dollars)
(Unaudited)	  		
 
Variable Annuity (VA) Lines
Historical Cash Flow Summary by Quarter
 
Death Benefits (GMDB)

   	  	3Q-08	  	2Q-08	  	1Q-08	  	4Q-07	  	3Q-07	  	2Q-07	  	1Q-07	
Premium	  	$	31	  	$	30	  	$	32	  	$	33	  	$	32	  	$	31	  	$	29	
less Paid Claims	  	 	14	  	 	8	  	 	7	  	 	3	  	 	3	  	 	2	  	 	1	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Net Cash	  	$	17	  	$	22	  	$	25	  	$	30	  	$	29	  	$	29	  	$	28	

Living Benefits (Includes GMIB and GMAB)	  			  			  			  			  			  			  			
								
   	  	3Q-08	  	2Q-08	  	1Q-08	  	4Q-07	  	3Q-07	  	2Q-07	  	1Q-07	
Premium	  	$	37	  	$	37	  	$	34	  	$	29	  	$	27	  	$	26	  	$	25	
less Paid Claims (1)	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	—  	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Net Cash	  	$	37	  	$	37	  	$	34	  	$	29	  	$	27	  	$	26	  	$	25	

Total VA Guaranteed Benefits	  			  			  			  			  			  			  			
								
   	  	3Q-08	  	2Q-08	  	1Q-08	  	4Q-07	  	3Q-07	  	2Q-07	  	1Q-07	
Premium	  	$	68	  	$	67	  	$	65	  	$	62	  	$	59	  	$	57	  	$	55	
less Paid Claims	  	 	14	  	 	8	  	 	7	  	 	3	  	 	3	  	 	2	  	 	2	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Net Cash	  	$	54	  	$	59	  	$	58	  	$	59	  	$	56	  	$	55	  	$	53	

Amounts represent past premium received and claims paid by quarter, split by benefit type.
 
Death Benefits (GMDB)
 
Premiums and claims from VA contracts reinsuring Guaranteed Minimum Death Benefits (GMDB)
 
Living Benefits (Includes GMIB and GMAB)
 
Premiums and claims from VA contracts reinsuring Guaranteed Minimum Income Benefits (GMIB) and Guaranteed Minimum Accumulation Benefits (GMAB), collectively known as Living Benefits.
 
(1)	Substantially all of our living benefit reinsurance clients’ policyholders are currently ineligible to trigger a claim payment. These policyholders begin to become eligible in 2013.	

Variable Annuity	  	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, 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	 	
										
Losses and loss expenses incurred	  	 	2,736	 	 	 	841	 	 	 	1,895	 	 	 	2,727	 	 	 	837	 	 	 	1,890	 	 	 	9	 	 	 	4	 	 	 	5	 	
Losses and loss expenses paid	  	 	(2,620	)	 	 	(1,024	)	 	 	(1,596	)	 	 	(2,391	)	 	 	(801	)	 	 	(1,590	)	 	 	(229	)	 	 	(223	)	 	 	(6	)	
Other (incl. foreign exch. revaluation)	  	 	12	 	 	 	12	 	 	 	—  	 	 	 	11	 	 	 	12	 	 	 	(1	)	 	 	1	 	 	 	—  	 	 	 	1	 	
Losses and loss expenses acquired (2)	  	 	386	 	 	 	33	 	 	 	353	 	 	 	386	 	 	 	33	 	 	 	353	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at June 30, 2008	  	$	37,696	 	 	$	12,932	 	 	$	24,764	 	 	$	32,177	 	 	$	9,305	 	 	$	22,872	 	 	$	5,519	 	 	$	3,627	 	 	$	1,892	 	
										
Losses and loss expenses incurred	  	 	3,995	 	 	 	1,626	 	 	 	2,369	 	 	 	3,976	 	 	 	1,615	 	 	 	2,361	 	 	 	19	 	 	 	11	 	 	 	8	 	
Losses and loss expenses paid	  	 	(2,767	)	 	 	(1,025	)	 	 	(1,742	)	 	 	(2,544	)	 	 	(818	)	 	 	(1,726	)	 	 	(223	)	 	 	(207	)	 	 	(16	)	
Other (incl. foreign exch. revaluation)	  	 	(551	)	 	 	(200	)	 	 	(351	)	 	 	(551	)	 	 	(200	)	 	 	(351	)	 	 	—  	 	 	 	—  	 	 	 	—  	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at September 30, 2008	  	$	38,373	 	 	$	13,333	 	 	$	25,040	 	 	$	33,058	 	 	$	9,902	 	 	$	23,156	 	 	$	5,315	 	 	$	3,431	 	 	$	1,884	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Add net recoverable on paid losses	  				 	 	892	 	 				 				 				 				 				 				 				
	  				 	 	 	 	 				 				 				 				 				 				 				
Reinsurance Recoverable	  				 	$	14,225	 	 				 				 				 				 				 				 				

(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)	Combined Insurance.	

Loss Reserve Rollforward	  	Page 13	

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

 	  	September 30
2008	 	 	June 30
2008	 	 	March 31
2008	 	 	December 31
2007	 	
Reinsurance recoverable on paid losses and loss expenses	  				 				 				 				
Active operations	  	$	643	 	 	$	706	 	 	$	686	 	 	$	697	 	
Brandywine	  	 	354	 	 	 	327	 	 	 	342	 	 	 	305	 	
Westchester Run-off	  	 	46	 	 	 	37	 	 	 	34	 	 	 	36	 	
Other Run-off	  	 	13	 	 	 	15	 	 	 	9	 	 	 	12	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	1,056	 	 	$	1,085	 	 	$	1,071	 	 	$	1,050	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Reinsurance recoverable on unpaid losses and loss expenses and benefits	  				 				 				 				
Active operations	  	$	10,389	 	 	$	9,810	 	 	$	9,746	 	 	$	10,016	 	
Brandywine	  	 	2,675	 	 	 	2,844	 	 	 	3,004	 	 	 	3,161	 	
Westchester Run-off	  	 	593	 	 	 	615	 	 	 	627	 	 	 	653	 	
Other Run-off	  	 	163	 	 	 	149	 	 	 	169	 	 	 	160	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	13,820	 	 	$	13,418	 	 	$	13,546	 	 	$	13,990	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross reinsurance recoverable	  				 				 				 				
Active operations	  	$	11,032	 	 	$	10,516	 	 	$	10,432	 	 	$	10,713	 	
Brandywine	  	 	3,029	 	 	 	3,171	 	 	 	3,346	 	 	 	3,466	 	
Westchester Run-off	  	 	639	 	 	 	652	 	 	 	661	 	 	 	689	 	
Other Run-off	  	 	176	 	 	 	164	 	 	 	178	 	 	 	172	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	14,876	 	 	$	14,503	 	 	$	14,617	 	 	$	15,040	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Provision for uncollectible reinsurance	  				 				 				 				
Active operations	  	$	(431	)	 	$	(432	)	 	$	(444	)	 	$	(435	)	
Brandywine	  	 	(174	)	 	 	(185	)	 	 	(189	)	 	 	(197	)	
Westchester Run-off	  	 	(31	)	 	 	(31	)	 	 	(31	)	 	 	(31	)	
Other Run-off	  	 	(15	)	 	 	(16	)	 	 	(16	)	 	 	(23	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	(651	)	 	$	(664	)	 	$	(680	)	 	$	(686	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net reinsurance recoverable	  				 				 				 				
Active operations	  	$	10,601	 	 	$	10,084	 	 	$	9,988	 	 	$	10,278	 	
Brandywine	  	 	2,855	 	 	 	2,986	 	 	 	3,157	 	 	 	3,269	 	
Westchester Run-off	  	 	608	 	 	 	621	 	 	 	630	 	 	 	658	 	
Other Run-off	  	 	161	 	 	 	148	 	 	 	162	 	 	 	149	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	14,225	 	 	$	13,839	 	 	$	13,937	 	 	$	14,354	 	

			
Reinsurance Recoverable	  	Page 14	

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

   	  	June 30, 2008	 	
   	  	Recoverable	  	Provision  (5)	  	% Of Gross	 	
Categories	  			  			  			
Largest Reinsurers (1)	  	$	9,074	  	$	127	  	1.4	%	
Other reinsurers balances rated A- or better	  	 	1,923	  	 	29	  	1.5	%	
Other reinsurers balances with rating lower than A- or not rated	  	 	812	  	 	151	  	18.6	%	
Other Pools and Government Agencies	  	 	198	  	 	12	  	6.1	%	
Structured Settlements	  	 	551	  	 	18	  	3.3	%	
Other Captives	  	 	1,507	  	 	7	  	0.5	%	
Others (2) 	  	 	438	  	 	320	  	73.1	%	
	  	 	 	  	 	 	  	 	 	
Total	  	$	14,503	  	$	664	  	4.6	%	

At June 30, 2008, $10.6 billion of ACE Limited recoverables were from rated reinsurers, of which 93.5% were rated the equivalent of A- or better by internationally recognized rating agencies.

Largest Reinsurers (3)	  	S&P Rating (4)	  	AM Best Rating (4)	
AGRI General Insurance Co	  	BBB	  	A	
American International Group (AIG) (6)	  	AA-	  	A+	
Berkshire Hathaway Insurance Group	  	AAA	  	A++	
Chubb Insurance Group	  	AA	  	A++	
Equitas	  	NR	  	NR	
Everest Re Group	  	AA-	  	A+	
Federal Crop Insurance Corp	  	NL	  	NL	
HDI Haftpflichtverband Der Deutschen Industrie Vag (Hannover)	  	AA-	  	A	
Lloyd’s Of London	  	A+	  	A	
Munich Re Group	  	AA-	  	A+	
National Workers Compensation Reinsurance Pool	  	Mandatory Pool	  	Mandatory Pool	
Partner Re	  	AA-	  	A+	
Swiss Re Group	  	AA-	  	A+	
WR Berkley Corp	  	A+	  	A+	
XL Capital Group	  	A+	  	A	
 
(1)	The Largest Reinsurers includes all reinsurers where gross recoverable exceeds 1% of ACE Shareholders’ equity. Total ACE Shareholders’ Equity at June 30, 2008 was $16.327 billion.	
 
(2)	Others 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 Others 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 Largest Reinsurers includes all reinsurers where gross recoverable (net of collateral) exceeds 1% of ACE Shareholders’ equity. The largest reinsurers account for 57.8% of total recoverables at June 30, 2008.	
 
(4)	S&P and AM Best ratings based on each group’s predominant reinsurer.	
 
(5)	See MD&A reported in the 2007 Form 10-K for a discussion on how ACE determines the provision for uncollectible reinsurance.	
 
(6)	Gross recoverables with American International Group (AIG) were $544.6 million at June 30, 2008, of which $420.8 million (77.3%) were with Transatlantic Rein Co.	

Reinsurance Recoverable - 2	  	Page 15	

							
	  		  	ACE Limited
Reinsurance Recoverable Analysis - 3
(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	  	$	672	 	 	$	399	 	 	$	1,071	 	
Provision at 3/31/08	  	 	40	 	 	 	164	 	 	 	204	 	
% of gross	  	 	6.0	%	 	 	41.1	%	 	 	19.0	%	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net balance at March 31, 2008	  	$	632	 	 	$	235	 	 	$	867	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Gross balance at June 30, 2008	  	$	732	 	 	$	353	 	 	$	1,085	 	
Provision at 6/30/08	  	 	37	 	 	 	141	 	 	 	178	 	
% of gross	  	 	5.1	%	 	 	39.9	%	 	 	16.4	%	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net balance at June 30, 2008	  	$	695	 	 	$	212	 	 	$	907	 	
	  	 	 	 	 	 	 	 	 	 	 	 	
Gross balance at September 30, 2008	  	$	713	 	 	$	343	 	 	$	1,056	 	
Provision at 9/30/08	  	 	34	 	 	 	130	 	 	 	164	 	
% of gross	  	 	4.8	%	 	 	37.9	%	 	 	15.5	%	
	  	 	 	 	 	 	 	 	 	 	 	 	
Net balance at September 30, 2008 (3) 	  	$	679	 	 	$	213	 	 	$	892	 	

(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 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 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 Recoverable - 3	  	Page 16	

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

 	  	September 30
2008	 	 	 	 	 	June 30
2008	 	 	 	 	 	March 31
2008	 	 	 	 	 	December 31
2007	 	 	 	 	
Market Value	  				 			 				 			 				 			 				 			
Fixed maturities available for sale	  	$	33,158	 	 			 	$	34,870	 	 			 	$	32,619	 	 			 	$	33,184	 	 			
Fixed maturities held to maturity	  	 	2,852	 	 			 	 	2,932	 	 			 	 	2,960	 	 			 	 	3,015	 	 			
Short-term investments	  	 	3,014	 	 			 	 	3,137	 	 			 	 	4,795	 	 			 	 	2,631	 	 			
	  	 	 	 	 			 	 	 	 	 			 	 	 	 	 			 	 	 	 	 			
Total	  	$	39,024	 	 			 	$	40,939	 	 			 	$	40,374	 	 			 	$	38,830	 	 			
	  	 	 	 	 			 	 	 	 	 			 	 	 	 	 			 	 	 	 	 			
Asset Allocation by Market Value	  				 			 				 			 				 			 				 			
Treasury	  	$	1,122	 	 	3	%	 	$	1,043	 	 	2	%	 	$	974	 	 	2	%	 	$	1,145	 	 	3	%	
Agency	  	 	1,816	 	 	5	%	 	 	1,677	 	 	4	%	 	 	1,939	 	 	5	%	 	 	1,820	 	 	5	%	
Corporate	  	 	8,779	 	 	22	%	 	 	9,689	 	 	25	%	 	 	8,906	 	 	22	%	 	 	9,015	 	 	23	%	
Mortgage-backed securities	  	 	12,451	 	 	32	%	 	 	12,674	 	 	31	%	 	 	13,087	 	 	32	%	 	 	13,733	 	 	35	%	
Asset-backed securities	  	 	837	 	 	2	%	 	 	1,041	 	 	2	%	 	 	1,060	 	 	3	%	 	 	1,150	 	 	3	%	
Municipal	  	 	1,833	 	 	5	%	 	 	1,950	 	 	5	%	 	 	2,025	 	 	5	%	 	 	1,844	 	 	5	%	
Non-U.S.	  	 	9,172	 	 	23	%	 	 	9,728	 	 	23	%	 	 	7,588	 	 	19	%	 	 	7,492	 	 	19	%	
Short-term investments	  	 	3,014	 	 	8	%	 	 	3,137	 	 	8	%	 	 	4,795	 	 	12	%	 	 	2,631	 	 	7	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	39,024	 	 	100	%	 	$	40,939	 	 	100	%	 	$	40,374	 	 	100	%	 	$	38,830	 	 	100	%	

Note: Insured municipal bonds represent $935 million, or 51% of our municipal bond holdings.	 	
									
Credit Quality by Market Value	  				 			 				 			 				 			 				 			
AAA	  	$	23,995	 	 	62	%	 	$	24,740	 	 	60	%	 	$	26,162	 	 	65	%	 	$	24,553	 	 	63	%	
AA	  	 	3,943	 	 	10	%	 	 	4,285	 	 	10	%	 	 	3,746	 	 	9	%	 	 	3,747	 	 	10	%	
A	  	 	4,969	 	 	13	%	 	 	5,572	 	 	14	%	 	 	4,620	 	 	12	%	 	 	4,590	 	 	12	%	
BBB	  	 	3,407	 	 	9	%	 	 	3,463	 	 	9	%	 	 	3,188	 	 	8	%	 	 	3,297	 	 	8	%	
BB	  	 	1,296	 	 	3	%	 	 	1,390	 	 	3	%	 	 	1,249	 	 	3	%	 	 	1,073	 	 	3	%	
B	  	 	1,315	 	 	3	%	 	 	1,416	 	 	4	%	 	 	1,341	 	 	3	%	 	 	1,481	 	 	4	%	
Other	  	 	99	 	 	0	%	 	 	73	 	 	0	%	 	 	68	 	 	0	%	 	 	89	 	 	0	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	$	39,024	 	 	100	%	 	$	40,939	 	 	100	%	 	$	40,374	 	 	100	%	 	$	38,830	 	 	100	%	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cost/Amortized Cost	  				 			 				 			 				 			 				 			
Fixed maturities available for sale	  	$	34,609	 	 			 	$	35,355	 	 			 	$	32,615	 	 			 	$	32,994	 	 			
Fixed maturities held to maturity	  	 	2,881	 	 			 	 	2,932	 	 			 	 	2,913	 	 			 	 	2,987	 	 			
Short-term investments	  	 	3,014	 	 			 	 	3,137	 	 			 	 	4,795	 	 			 	 	2,631	 	 			
	  	 	 	 	 			 	 	 	 	 			 	 	 	 	 			 	 	 	 	 			
Subtotal	  	 	40,504	 	 			 	 	41,424	 	 			 	 	40,323	 	 			 	 	38,612	 	 			
Equity securities	  	 	1,336	 	 			 	 	1,502	 	 			 	 	1,597	 	 			 	 	1,618	 	 			
Other investments	  	 	1,327	 	 			 	 	1,182	 	 			 	 	992	 	 			 	 	880	 	 			
	  	 	 	 	 			 	 	 	 	 			 	 	 	 	 			 	 	 	 	 			
Total	  	$	43,167	 	 			 	$	44,108	 	 			 	$	42,912	 	 			 	$	41,110	 	 			
	  	 	 	 	 			 	 	 	 	 			 	 	 	 	 			 	 	 	 	 			
Avg. duration of fixed maturities	  	 	3.8 years	 	 			 	 	3.7 years	 	 			 	 	3.5 years	 	 			 	 	3.5 years	 	 			
Avg. market yield of fixed maturities	  	 	6.1	%	 			 	 	5.6	%	 			 	 	5.1	%	 			 	 	5.3	%	 			
Avg. credit quality	  	 	AA	 	 			 	 	AA	 	 			 	 	AA	 	 			 	 	AA	 	 			

Investments	  	Page 17	

					
	  	ACE Limited
Investment Portfolio - 2
(in millions of U.S. dollars)
(Unaudited)	  		
 
Mortgage-backed and Asset-backed Fixed Income Portfolio
Market Value at September 30, 2008

 	  	S&P Credit Rating	
 	  	AAA	  	AA	  	A	  	BBB	  	BB and below	  	Total	
Mortgage-backed securities	  			  			  			  			  			  			
Residential mortgage-backed (RMBS)	  			  			  			  			  			  			
GNMA	  	$	360	  	$	—  	  	$	—  	  	$	—  	  	$	—  	  	$	360	
FNMA	  	 	4,943	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	4,943	
Freddie Mac	  	 	2,461	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	2,461	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total agency RMBS	  	 	7,764	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	7,764	
Non-agency RMBS	  	 	2,353	  	 	12	  	 	1	  	 	1	  	 	—  	  	 	2,367	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total residential mortgage-backed	  	 	10,117	  	 	12	  	 	1	  	 	1	  	 	—  	  	 	10,131	
							
Commercial mortgage-backed	  	 	2,303	  	 	4	  	 	10	  	 	3	  	 	—  	  	 	2,320	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total mortgage-backed securities	  	$	12,420	  	$	16	  	$	11	  	$	4	  	$	—  	  	$	12,451	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Asset-backed securities	  			  			  			  			  			  			
Sub-prime	  	$	85	  	$	8	  	$	5	  	$	—  	  	$	—  	  	$	98	
Credit cards	  	 	58	  	 	—  	  	 	16	  	 	8	  	 	—  	  	 	82	
Autos	  	 	379	  	 	53	  	 	7	  	 	12	  	 	—  	  	 	451	
Other	  	 	194	  	 	7	  	 	3	  	 	1	  	 	1	  	 	206	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total asset-backed securities	  	$	716	  	$	68	  	$	31	  	$	21	  	$	1	  	$	837	

Insured asset-backed securities represent $147 million, or 18% of our asset-backed security holdings.

Investments 2	  	Page 18	

					
	  	ACE Limited
Investment Portfolio - 3
(in millions of U.S. dollars)
(Unaudited)	  		
 
Mortgage-backed and Asset-backed Fixed Income Portfolio
Market Value at September 30, 2008
 
Mortgage-backed securities total $12.5 billion, are rated predominantly AAA and comprise 32% of the fixed income portfolio. This compares to a 45% mortgage-backed weighting in representative indices of the U.S. fixed income market. The minimum rating for initial purchases of mortgage and asset backed securities is AAA.
 
ACE suspended new investments in ALT-A, credit card, auto and subprime backed securities in 1Q2008.
 
Securities issued by Federal agencies with implied or explicit government guarantees total $7.8 billion and represent 77% of the residential mortgage-backed portfolio.
 
Non-agency residential mortgage-backed securities are rated predominantly AAA, backed by prime collateral and broadly diversified in over 300,000 loans. The portfolio’s loan-to-value ratio is approximately 68% with an average FICO score of 736. With this conservative loan-to-value ratio and subordinated collateral of 12%, the cumulative 5-year foreclosure rate would have to rise to 28% and real estate values would have to fall 61% before principal is impaired. The comparable historical cumulative foreclosure rate is 2.5% for prime mortgages.
 
Within the portfolio of prime AAA non-agency RMBS are $197 million of holdings classified as ALT-A. These ALT-A holdings are broadly diversified with over 69% issued prior to 2006. The average FICO score is 714 with a relatively conservative loan-to-value ratio of 71%. With subordinated collateral of 21%, the cumulative 4-year foreclosure rate would have to rise to 50% and real estate values would have to fall more than 59% before principal is impaired. The comparable historical cumulative foreclosure rate is approximately 8%.
 
Commercial mortgage-backed securities of $2.3 billion are rated predominantly AAA, broadly diversified with over 26,000 loans and seasoned with 71% of the portfolio issued before 2006. The average loan-to-value ratio is approximately 63% with a debt service coverage ratio in excess of 1.7 and weighted average subordinated collateral of 26%. The cumulative foreclosure rate would have to rise to 61% and commercial real estate values would have to fall more than 64% before principal is impaired. The historical annual delinquency rate is 1%.
 
Subprime asset-backed securities (current holdings of $100 million) are rated predominantly AA, broadly diversified in over 125,000 loans with an average loan-to-value ratio of approximately 80% and an average FICO score of 610. With subordinated collateral of 34%, the cumulative 5-year foreclosure rate would have to rise to 79% and real estate values would have to fall more than 54% before principal is impaired. The comparable historical cumulative 5-year foreclosure rate is 27%. The ratings have been reaffirmed on substantially all of these securities.
 
Auto loan asset-backed securities are rated predominantly AAA with a short duration of approximately 0.8 years and average subordinated collateral of 12%. Annual default rates would have to rise to 8 times their historic average of 1.5% before principal is impaired.

Investments 3	  	Page 19	

					
	  	ACE Limited
Investment Portfolio - 4
(in millions of U.S. dollars)
(Unaudited)	  		
 
Mortgage-backed and Asset-backed Fixed Income Portfolio
Amoritized Cost at September 30, 2008

 	  	S&P Credit Rating	
 	  	AAA	  	AA	  	A	  	BBB	  	BB and below	  	Total	
Mortgage-backed securities	  			  			  			  			  			  			
Residential mortgage-backed (RMBS)	  			  			  			  			  			  			
GNMA	  	$	357	  	$	—  	  	$	—  	  	$	—  	  	$	—  	  	$	357	
FNMA	  	 	4,889	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	4,889	
Freddie Mac	  	 	2,435	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	2,435	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total agency RMBS	  	 	7,681	  	 	—  	  	 	—  	  	 	—  	  	 	—  	  	 	7,681	
Non-agency RMBS	  	 	2,756	  	 	15	  	 	1	  	 	1	  	 	—  	  	 	2,773	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total residential mortgage-backed	  	 	10,437	  	 	15	  	 	1	  	 	1	  	 	—  	  	 	10,454	
							
Commercial mortgage-backed	  	 	2,442	  	 	4	  	 	10	  	 	3	  	 	—  	  	 	2,459	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total mortgage-backed securities	  	$	12,879	  	$	19	  	$	11	  	$	4	  	$	—  	  	$	12,913	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Asset-backed securities	  			  			  			  			  			  			
Sub-prime	  	$	97	  	$	9	  	$	5	  	$	—  	  	$	—  	  	$	111	
Credit cards	  	 	58	  	 	—  	  	 	16	  	 	8	  	 	—  	  	 	82	
Autos	  	 	383	  	 	56	  	 	7	  	 	12	  	 	—  	  	 	458	
Other	  	 	196	  	 	7	  	 	3	  	 	1	  	 	1	  	 	208	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total asset-backed securities	  	$	734	  	$	72	  	$	31	  	$	21	  	$	1	  	$	859	

Insured asset-backed securities represent $152 million, or 18% of our asset-backed security holdings.

Investments 4	  	Page 20	

					
	  	ACE Limited
Investment Portfolio - 5
(in millions of U.S. dollars)
(Unaudited)	  		
 
Market Value at September 30, 2008

 	  	S&P Credit Rating	
 	  	AAA	  	AA	  	A	  	BBB	  	BB and below	  	Total	
U.S. Investment Grade Corporate Fixed Income Portfolio	  			  			  			  			  			  			
Banks	  	$	4	  	$	1,051	  	$	882	  	$	61	  	$	—  	  	$	1,998	
Basic Materials	  	 	—  	  	 	—  	  	 	30	  	 	72	  			  	 	102	
Communications	  	 	1	  	 	—  	  	 	307	  	 	435	  			  	 	743	
Consumer, Cyclical	  	 	8	  	 	80	  	 	128	  	 	111	  			  	 	327	
Consumer, Non-Cyclical	  	 	12	  	 	54	  	 	325	  	 	161	  			  	 	552	
Diversified Financial Services	  	 	36	  	 	67	  	 	289	  	 	59	  			  	 	451	
Energy	  	 	—  	  	 	8	  	 	148	  	 	373	  			  	 	529	
Industrial	  	 	293	  	 	28	  	 	192	  	 	110	  			  	 	623	
Utilities	  	 	—  	  	 	10	  	 	179	  	 	332	  			  	 	521	
All Others	  	 	55	  	 	136	  	 	230	  	 	184	  	 	—  	  	 	605	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total	  	$	409	  	$	1,434	  	$	2,710	  	$	1,898	  	$	—  	  	$	6,451	

U.S. Investment Grade Corporate Fixed Income Portfolio
 
The average credit quality of ACE’s US investment grade bond portfolio is very high at AA+. 66% of investment grade securities holdings are rated AAA or guaranteed by governments or quasi-government agencies.
 
ACE prohibits investments in complex structured securities (e.g. CDOs, CLOs) and over-the-counter derivatives and does not permit the use of portfolio leverage.
 
Corporate bond holdings are highly diversified across industries and geographies. Issuer limits are based on credit rating (AA 2%, A 1%, BBB .5% of total portfolio) and are monitored on a daily basis by ACE via an internal compliance system.

Investment 5	  	Page 21	

					
	  	ACE Limited
Investment Portfolio - 6
(in millions of U.S. dollars)
(Unaudited)	  		
 
Market Value at September 30, 2008

 	  	S&P Credit Rating	
 	  	BB	  	B	  	CCC	  	Other	  	 	  	Total	
Below Investment Grade Corporate Fixed Income Portfolio	  			  			  			  			  			  			
Basic Materials	  	$	86	  	$	31	  	$	5	  	$	—  	  	$	—  	  	$	122	
Communications	  	 	219	  	 	154	  	 	11	  	 	—  	  			  	 	384	
Consumer, Cyclical	  	 	118	  	 	165	  	 	13	  	 	—  	  			  	 	296	
Consumer, Non-Cyclical	  	 	154	  	 	245	  	 	21	  	 	—  	  			  	 	420	
Diversified Financial Services	  	 	15	  	 	97	  	 	3	  	 	4	  			  	 	119	
Energy	  	 	241	  	 	136	  	 	1	  	 	—  	  			  	 	378	
Industrial	  	 	152	  	 	127	  	 	3	  	 	—  	  			  	 	282	
Utilities	  	 	93	  	 	91	  	 	—  	  	 	—  	  			  	 	184	
All Others	  	 	54	  	 	82	  	 	7	  	 	—  	  	 	—  	  	 	143	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
Total	  	$	1,132	  	$	1,128	  	$	64	  	$	4	  	$	—  	  	$	2,328	

Below Investment Grade Corporate Fixed income Portfolio
 
ACE manages high yield bonds as a distinct and separate asset class from investment grade bonds. ACE’s allocation to high yield bonds is explicitly set by internal management and is targeted to securities in the upper tier of credit quality (BB/B). Our minimum rating for initial purchase is BB/B.
 
Four external investment managers are responsible for high yield security selection and portfolio construction.
 
ACE’s high yield managers have a conservative approach to credit selection and very low historical default experience.
 
Securities holdings are highly diversified across industries and are subject to a 1.5% issuer limit as a percentage of high yield allocation (or 0.1% of total portfolio). The portfolio is comprised of over 500 issuers with our largest current issuer exposure at $38 million. ACE monitors position limits on a daily basis through an internal compliance system.
 
Derivative and structured securities (e.g. credit default swaps, CLOs) are not permitted in high yield portfolios.

Investments 6	  	Page 22	

					
	  	ACE Limited
Investment Portfolio - 7
(in millions of U.S. dollars)
(Unaudited)	  		
 
Market Value at September 30, 2008

 	  	S&P Credit Rating	
 	  	AAA	  	AA	  	A	  	BBB	  	BB and below	  	Total	
Non-U.S. Fixed Income Portfolio	  			  			  			  			  			  			
United Kingdom	  	$	1,277	  			  			  			  			  	$	1,277	
Germany	  	 	466	  			  			  			  			  	 	466	
France	  	 	330	  			  			  			  			  	 	330	
Canada	  	 	673	  			  			  			  			  	 	673	
Japan	  	 	—  	  	 	165	  			  			  			  	 	165	
Other Foreign Government	  	 	686	  	 	285	  	 	329	  	 	203	  	 	17	  	 	1,520	
Non US Corporate	  	 	682	  	 	798	  	 	1,762	  	 	1,194	  	 	305	  	 	4,741	
	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	
	  	$	4,114	  	$	1,248	  	$	2,091	  	$	1,397	  	$	322	  	$	9,172	

Non-US Fixed Income Portfolio
 
ACE’s non-US investment grade fixed income portfolios are currency-matched with the insurance liabilities of ACE’s non-US operations.
 
89% of ACE’s non-US fixed income is denominated in G7 currencies.
 
Average credit quality of non-US fixed income securities is very high at AA and 54% of holdings are rated AAA or guaranteed by governments or quasi-government agencies.
 
Corporate bond holdings are highly diversified across industries and geographies. Issuer limits are based on credit rating (AA 2%, A 1%, BBB .5% of total portfolio) and are monitored on a daily basis by ACE via an internal compliance system.

Investments 7	  	Page 23	

					
	  	ACE Limited
Investment Portfolio - 8
(in millions of U.S. dollars)
(Unaudited)	  		
 
Investment portfolio
Top 25 Exposures - Fixed Maturity Investments

September 30, 2008	  	 	  	Rating	
General Electric Co	  	$	390	  	AAA	
JP Morgan Chase & Co	  	 	319	  	AA-	
Bank of America Corp	  	 	269	  	AA-	
Citigroup Inc	  	 	247	  	AA-	
HSBC Holdings Plc	  	 	181	  	AA-	
AT&T INC	  	 	171	  	A	
Wells Fargo & Co	  	 	167	  	AA+	
Comcast Corp	  	 	159	  	BBB+	
Time Warner Inc	  	 	157	  	BBB+	
Royal Bank of Scotland Group Plc	  	 	136	  	A+	
Goldman Sachs Group Inc	  	 	134	  	AA-	
ConocoPhillips	  	 	124	  	A	
Verizon Communications Inc	  	 	117	  	A	
Wachovia Corp	  	 	116	  	A+	
Merrill Lynch & Co Inc	  	 	115	  	A	
Credit Suisse Group	  	 	113	  	A+	
Morgan Stanley	  	 	106	  	A+	
Telecom Italia SpA	  	 	97	  	BBB	
XTO Energy Inc	  	 	92	  	BBB	
Deutsche Telekom AG	  	 	76	  	BBB+	
Barclays PLC	  	 	73	  	AA-	
Dominion Resources Inc/VA	  	 	70	  	A-	
BT Group PLC	  	 	70	  	BBB+	
HBOS PLC	  	 	69	  	A+	
Australia & New Zealand Banking	  	 	66	  	AA	

Investments 8	  	Page 24	

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

 	  	Three months ended September 30, 2008	 	 	Nine months ended September 30, 2008	 	
 	  	Net Realized
Gains
(Losses) (1)	 	 	Net Unrealized
Gains
(Losses)	 	 	Net
Impact	 	 	Net Realized
Gains
(Losses) (1)	 	 	Net Unrealized
Gains
(Losses)	 	 	Net
Impact	 	
Fixed maturities	  	$	(272	)	 	$	(952	)	 	$	(1,224	)	 	$	(575	)	 	$	(1,605	)	 	$	(2,180	)	
Equity securities	  	 	(126	)	 	 	(95	)	 	 	(221	)	 	 	(167	)	 	 	(326	)	 	 	(493	)	
Equity and fixed income derivatives	  	 	15	 	 	 	—  	 	 	 	15	 	 	 	(10	)	 	 	—  	 	 	 	(10	)	
Foreign exchange gains (losses)	  	 	15	 	 	 	—  	 	 	 	15	 	 	 	33	 	 	 	—  	 	 	 	33	 	
Other	  	 	4	 	 	 	(72	)	 	 	(68	)	 	 	(19	)	 	 	(88	)	 	 	(107	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Sub-total	  	 	(364	)	 	 	(1,119	)	 	 	(1,483	)	 	 	(738	)	 	 	(2,019	)	 	 	(2,757	)	
Mark-to-market gains (losses) from derivative transactions (2)	  	 	(146	)	 	 	—  	 	 	 	(146	)	 	 	(251	)	 	 	—  	 	 	 	(251	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total gains (losses)	  	 	(510	)	 	 	(1,119	)	 	 	(1,629	)	 	 	(989	)	 	 	(2,019	)	 	 	(3,008	)	
Partially-owned insurance companies (3)	  	 	(23	)	 	 	(20	)	 	 	(43	)	 	 	69	 	 	 	(6	)	 	 	63	 	
Income tax expense (benefit)	  	 	(83	)	 	 	(265	)	 	 	(348	)	 	 	(130	)	 	 	(317	)	 	 	(447	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net gains (losses)	  	$	(450	)	 	$	(874	)	 	$	(1,324	)	 	$	(790	)	 	$	(1,708	)	 	$	(2,498	)	

(1)	The quarter includes impairments of $196M for fixed maturities, $28M for equities and $nil for other investments. Year to date includes impairments of $495M for fixed maturities, $103M for equities and $25M for other investments.	
 
(2)	Includes $161M and $279M of unrealized losses primarily on the guaranteed minimum income benefit derivatives from our life reinsurance operations for the quarter and year to date, respectively.	
 
(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 September 30, 2007	 	 	Nine months ended September 30, 2007	 	
 	  	Net Realized
Gains
(Losses) (4)	 	 	Net Unrealized
Gains
(Losses)	 	 	Net
Impact	 	 	Net Realized
Gains
(Losses) (4)	 	 	Net Unrealized
Gains
(Losses)	 	 	Net
Impact	 	
Fixed maturities	  	$	(6	)	 	$	268	 	 	$	262	 	 	$	(90	)	 	$	(137	)	 	$	(227	)	
Equity securities	  	 	57	 	 	 	(48	)	 	 	9	 	 	 	142	 	 	 	(15	)	 	 	127	 	
Equity and fixed income derivatives	  	 	(9	)	 	 	—  	 	 	 	(9	)	 	 	(14	)	 	 	—  	 	 	 	(14	)	
Foreign exchange gains (losses)	  	 	2	 	 	 	—  	 	 	 	2	 	 	 	3	 	 	 	—  	 	 	 	3	 	
Other	  	 	6	 	 	 	4	 	 	 	10	 	 	 	18	 	 	 	37	 	 	 	55	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total inv. portfolio gains (losses)	  	 	50	 	 	 	224	 	 	 	274	 	 	 	59	 	 	 	(115	)	 	 	(56	)	
Mark-to-market gains (losses) from derivative transactions	  	 	(50	)	 	 	—  	 	 	 	(50	)	 	 	(54	)	 	 	—  	 	 	 	(54	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total gains (losses)	  	 	—  	 	 	 	224	 	 	 	224	 	 	 	5	 	 	 	(115	)	 	 	(110	)	
Partially-owned insurance companies (3)	  	 	(38	)	 	 	—  	 	 	 	(38	)	 	 	(38	)	 	 	—  	 	 	 	(38	)	
Income tax expense (benefit)	  	 	(2	)	 	 	10	 	 	 	8	 	 	 	(20	)	 	 	(10	)	 	 	(30	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net gains (losses)	  	$	(36	)	 	$	214	 	 	$	178	 	 	$	(13	)	 	$	(105	)	 	$	(118	)	

(4)	The quarter includes impairments of $13M for fixed maturities and $5M for equities. Year to date includes impairments of $63M for fixed maturities, $7M for equities and $2M for other investments.	

Investment Gains (Losses)	  	Page 25	

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

 	  	September 30
2008	 	 	June 30
2008	 	 	March 31
2008	 	 	December 31
2007	 	 	December 31
2006	 	
Total short-term debt (1)	  	$	333	 	 	$	1,050	 	 	$	1,341	 	 	$	372	 	 	$	578	 	
Total long-term debt	  	 	3,002	 	 	 	3,008	 	 	 	2,114	 	 	 	1,811	 	 	 	1,560	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total debt	  	$	3,335	 	 	$	4,058	 	 	 	3,455	 	 	 	2,183	 	 	$	2,138	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total trust preferred securities	  	$	309	 	 	$	309	 	 	$	309	 	 	$	309	 	 	$	309	 	

Perpetual preferred shares	  	$	—  	 	 	$	—  	 	 	 	557	 	 	$	557	 	 	$	557	 	
Common shareholders’ equity	  	 	15,356	 	 	 	16,327	 	 	 	16,178	 	 	 	16,120	 	 	 	13,721	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total shareholders’ equity	  	$	15,356	 	 	$	16,327	 	 	$	16,735	 	 	$	16,677	 	 	$	14,278	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total capitalization	  	$	19,000	 	 	$	20,694	 	 	$	20,499	 	 	$	19,169	 	 	$	16,725	 	
Tangible shareholders’ equity (2)	  	$	11,539	 	 	$	12,715	 	 	$	13,856	 	 	$	13,839	 	 	$	11,439	 	
						
Leverage ratios	  				 				 				 				 				
Debt/ total capitalization	  	 	17.6	%	 	 	19.6	%	 	 	16.9	%	 	 	11.4	%	 	 	12.8	%	
Debt plus trust preferred secutities/ total capitalization	  	 	19.2	%	 	 	21.1	%	 	 	18.4	%	 	 	13.0	%	 	 	14.6	%	
Debt/ tangible equity	  	 	28.9	%	 	 	31.9	%	 	 	24.9	%	 	 	15.8	%	 	 	18.7	%	
Debt plus trust preferred securities/ tangible equity	  	 	31.6	%	 	 	34.3	%	 	 	27.2	%	 	 	18.0	%	 	 	21.4	%	
Debt plus total preferred stock/ total capitalization	  	 	19.2	%	 	 	21.1	%	 	 	21.1	%	 	 	15.9	%	 	 	18.0	%	
 
(1)	Includes $1.0 billion and $705 million of repurchase agreements for the Combined Insurance acquisition for Q1 and Q2, respectively.	
 
(2)	Tangible equity is equal to shareholders’ equity less goodwill and other intangible assets.	

Capital Structure	  	Page 26	

					
	  	ACE Limited
Debt, Trust Preferred and Credit Facilities
(in millions of U.S. dollars)
(Unaudited)	  		

 	  	Par amount
outstanding	  	Coupon	 	 	Maturity Date	
Debt and Trust Preferred	  			  				 		
ACE US Holdings Senior Notes (1)	  	$	250	  	 	6.47	%	 	October 1, 2008	
ACE Australia Holdings PTY Limited Term Loan	  	$	79	  	 	7.81	%	 	December 19, 2008	
ACE INA Holdings Inc Subordinated Notes	  	$	200	  	 	8.41	%	 	December 1, 2009	
ACE European Holdings No2 Limited Term Loan	  	$	178	  	 	5.25	%	 	December 13, 2010	
ACE INA Holdings Inc. Term Loan	  	$	450	  	 	4.15	%	 	April 1, 2013	
ACE INA Holdings Inc. Senior Notes	  	$	500	  	 	5.88	%	 	June 15, 2014	
ACE INA Holdings Inc. Senior Notes	  	$	450	  	 	5.60	%	 	May 15, 2015	
ACE INA Holdings Inc. Senior Notes	  	$	500	  	 	5.70	%	 	February 15, 2017	
ACE INA Holdings Inc. Senior Notes	  	$	300	  	 	5.80	%	 	March 15, 2018	
ACE INA Holdings Inc. Debentures	  	$	100	  	 	8.88	%	 	August 15, 2029	
ACE Capital Trust II Capital Securities	  	$	300	  	 	9.70	%	 	April 1, 2030	
ACE INA Holdings Inc. Senior Notes	  	$	300	  	 	6.70	%	 	May 15, 2036	
				
 	  	Commitment	  	LOC Usage	 	 	Maturity Date	
Credit Facilities	  			  				 		
Syndicated Letter of Credit Facility	  	$	1,000	  	$	688	 	 	November 8, 2012	
Revolving Credit / LOC Facility	  	$	500	  	$	64	 	 	November 8, 2012	
Funds at Lloyds Capital Facility	  	$	534	  	$	306	 	 	December 31, 2013	
 
(1)	Notes repaid with proceeds from security repurchase agreements that mature on December 3, 2008.	

Capital Structure 2	  	Page 27	

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

 	  	Three months ended September 30	 	 	Nine months ended September 30	 	
 	  	2008	 	 	2007	 	 	2008	 	 	2007	 	
Numerator	  				 				 				 				
Income excluding net realized gains (losses) (1)	  	$	504	 	 	$	692	 	 	$	1,967	 	 	$	2,019	 	
Perpetual preferred dividend	  	 	—  	 	 	 	(11	)	 	 	(24	)	 	 	(33	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income to common shares, excl. net realized gains (losses)	  	 	504	 	 	 	681	 	 	 	1,943	 	 	 	1,986	 	
Net realized gains (losses), net of income tax	  	 	(450	)	 	 	(36	)	 	 	(790	)	 	 	(13	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income available to the holders of common shares	  	 	54	 	 	 	645	 	 	 	1,153	 	 	 	1,973	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Rollforward of Common Shares Outstanding	  				 				 				 				
Shares - beginning of period	  	 	333,249,308	 	 	 	329,009,343	 	 	 	329,704,531	 	 	 	326,455,468	 	
Issued under employee stock purchase plan	  	 	—  	 	 	 	101,234	 	 	 	203,455	 	 	 	205,396	 	
Shares (cancelled) granted	  	 	(58,647	)	 	 	11,614	 	 	 	1,093,933	 	 	 	1,259,080	 	
Issued for option exercises	  	 	203,947	 	 	 	338,176	 	 	 	2,392,689	 	 	 	1,540,423	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Shares - end of period	  	 	333,394,608	 	 	 	329,460,367	 	 	 	333,394,608	 	 	 	329,460,367	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Denominator	  				 				 				 				
Weighted average shares outstanding	  	 	329,017,376	 	 	 	325,201,688	 	 	 	328,264,771	 	 	 	324,670,960	 	
Effect of other dilutive securities	  	 	4,030,013	 	 	 	5,419,353	 	 	 	4,416,680	 	 	 	5,413,751	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Adj. wtd. avg. shares outstanding and assumed conversions	  	 	333,047,389	 	 	 	330,621,041	 	 	 	332,681,451	 	 	 	330,084,711	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic earnings per share	  				 				 				 				
Income excluding net realized gains (losses) (1)	  	$	1.53	 	 	$	2.09	 	 	$	5.92	 	 	$	6.12	 	
Net realized gains (losses), net of income tax	  	 	(1.37	)	 	 	(0.11	)	 	 	(2.41	)	 	 	(0.04	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	$	0.16	 	 	$	1.98	 	 	$	3.51	 	 	$	6.08	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Diluted earnings per share	  				 				 				 				
Income excluding net realized gains (losses) (1)	  	$	1.51	 	 	$	2.06	 	 	$	5.84	 	 	$	6.02	 	
Net realized gains (losses), net of income tax	  	 	(1.35	)	 	 	(0.11	)	 	 	(2.38	)	 	 	(0.04	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	  	$	0.16	 	 	$	1.95	 	 	$	3.46	 	 	$	5.98	 	

(1)	See page 29 Non-GAAP Financial Measures.	

Earning per share	  	Page 28	

					
	  	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 30.
 
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, future policy 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).

 	  	3Q-08	 	 	2Q-08	 	 	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	YTD
2008	 	 	YTD
2007	 	 	Full Year
2007	 	
Net income, as reported	  	$	54	 	 	$	746	 	 	$	377	 	 	$	572	 	 	$	656	 	 	$	1,177	 	 	$	2,006	 	 	$	2,578	 	
Net realized gains (losses)	  	 	(510	)	 	 	(126	)	 	 	(353	)	 	 	(66	)	 	 	—  	 	 	 	(989	)	 	 	5	 	 	 	(61	)	
Net realized gains (losses) in other income (expense) (1)	  	 	(23	)	 	 	120	 	 	 	(28	)	 	 	(57	)	 	 	(38	)	 	 	69	 	 	 	(38	)	 	 	(95	)	
Income tax expense (benefit) on net realized gains (losses)	  	 	(83	)	 	 	(14	)	 	 	(33	)	 	 	(2	)	 	 	(2	)	 	 	(130	)	 	 	(20	)	 	 	(22	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income excluding net realized gains (losses)	  	$	504	 	 	$	738	 	 	$	725	 	 	$	693	 	 	$	692	 	 	$	1,967	 	 	$	2,019	 	 	$	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 29	

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

 	  	September 30
2008	  	June 30
2008	  	March 31
2008	 	 	December 31
2007	 	
Shareholders’ equity	  	$	15,356	  	$	16,327	  	$	16,735	 	 	$	16,677	 	
Proceeds from issuance of perpetual preferred shares	  	 	—  	  	 	—  	  	 	(557	)	 	 	(557	)	
	  	 	 	  	 	 	  	 	 	 	 	 	 	 	
Numerator for book value per share calculation	  	 	15,356	  	 	16,327	  	 	16,178	 	 	 	16,120	 	
Less: goodwill and other intangible assets	  	 	3,817	  	 	3,612	  	 	2,879	 	 	 	2,838	 	
	  	 	 	  	 	 	  	 	 	 	 	 	 	 	
Numerator for tangible book value per share	  	$	11,539	  	$	12,715	  	$	13,299	 	 	$	13,282	 	

Denominator	  	 	333,394,608	  	 	333,249,308	  	 	332,506,547	 	 	 	329,704,531	 	

Book value per common share	  	$	46.06	  	$	48.99	  	$	48.65	 	 	$	48.89	 	
Tangible book value per common share	  	$	34.61	  	$	38.15	  	$	40.00	 	 	$	40.28	 	

Reconciliation Book Value	  	Page 30	

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

 	  	3Q-08	 	 	2Q-08	 	 	1Q-08	 	 	4Q-07	 	 	3Q-07	 	 	YTD
2008	 	 	YTD
2007	 	 	Full Year
2007	 	
Net income	  	$	54	 	 	$	746	 	 	$	377	 	 	$	572	 	 	$	656	 	 	$	1,177	 	 	$	2,006	 	 	$	2,578	 	
Net unrealized appreciation (depreciation) on investments	  				 				 				 				 				 				 				 				
Unrealized appreciation (depreciation) on investments	  	 	(1,522	)	 	 	(731	)	 	 	(497	)	 	 	133	 	 	 	218	 	 	 	(2,750	)	 	 	(136	)	 	 	(3	)	
Reclassification adjustment for net realized gains (losses) included in net income	  	 	383	 	 	 	169	 	 	 	173	 	 	 	6	 	 	 	6	 	 	 	725	 	 	 	21	 	 	 	27	 	
Change in cumulative translation adjustments	  	 	(155	)	 	 	6	 	 	 	27	 	 	 	12	 	 	 	58	 	 	 	(122	)	 	 	93	 	 	 	105	 	
Change in minimum pension liability	  	 	5	 	 	 	1	 	 	 	—  	 	 	 	(1	)	 	 	(1	)	 	 	6	 	 	 	(3	)	 	 	(4	)	
Income tax (expense) benefit related to other comprehensive income items	  	 	320	 	 	 	27	 	 	 	8	 	 	 	(37	)	 	 	(28	)	 	 	355	 	 	 	(23	)	 	 	(60	)	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other comprehensive income (loss)	  	 	(969	)	 	 	(528	)	 	 	(289	)	 	 	113	 	 	 	253	 	 	 	(1,786	)	 	 	(48	)	 	 	65	 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Comprehensive income (loss)	  	$	(915	)	 	$	218	 	 	$	88	 	 	$	685	 	 	$	909	 	 	$	(609	)	 	$	1,958	 	 	$	2,643	 	

			
Comprehensive Income	  	Page 31	

					
	  	ACE Limited
Glossary	  		
 
Annualized return on ordinary shareholders’ equity (ROE): Income excluding net realized gains (losses) less perpetual preferred securities divided by average common shareholders’ equity for the period. To annualize a quarterly rate multiply by four.
 
Book value per common share: Common shareholders’ equity divided by the shares outstanding.
 
Combined Insurance: Combined Insurance Company of America, acquired April 1, 2008.
 
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.
 
Common shareholders’ equity: Shareholders’ equity less perpetual preferred shares.
 
Tangible book value per common share: Common shareholders’ equity less goodwill and other itangible assets divided by the shares outstanding.
 
Tangible equity: Shareholders’ equity less goodwill and other intangible assets.
 
Total capitalization: Short-term debt, long-term debt, trust preferreds, perpetual preferred shares and shareholders’ equity.

Glossary	  	Page 32