Exhibit 99.1

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                                                     XL Capital Ltd
                                                     XL House
                                                     One Bermudiana Road
                                                     Hamilton HM 11
                                                     Bermuda

                                                     Phone    (441) 292 8515
                                                     Fax      (441) 292 5280

Press Release


Contact: Gavin R. Arton                              Roger R. Scotton
         Investor Relations                          Media Relations
         (441) 294 7104                              (441) 294 7165


    XL Capital Ltd announces its intention to make a one-time cash payment to
         holders of its Zero-Coupon Convertible Debentures due May 2021
                          for not exercising put rights




HAMILTON, BERMUDA, May 18, 2004 - XL Capital Ltd ("XL" or "the Company") (NYSE:
XL) announced today that it intends to make a one-time cash payment to holders
of its Zero-Coupon Convertible Debentures due 2021 (the "Debentures") who do not
exercise their rights to put the Debentures to XL.

Pursuant to the terms of the indenture governing the Debentures, XL is obligated
to purchase for cash Debentures tendered and not withdrawn before the close of
business on May 21, 2004 at their accreted value of $641.88 per $1,000 principal
amount at maturity on May 24, 2004. XL intends to pay a one-time cash payment of
$14.84 for every $1,000 aggregate principal amount at maturity of the Debentures
held to each Debenture holder not exercising its put right. This payment is
approximately equal to 2.31% of each Debenture's accreted value and 1.48% of
each Debenture's principal amount at maturity. XL will make this payment to
holders of record as of the close of business on May 26, 2004, as promptly as
possible following that date. In the event all of the Debentures remain
outstanding on that date, the aggregate payment by XL would be $15 million.

XL Capital Ltd, through its operating subsidiaries, is a leading provider of
insurance and reinsurance coverages and financial products and services to
industrial, commercial and professional service firms, insurance companies, and
other enterprises on a worldwide basis. As of March 31, 2004, XL Capital Ltd had
consolidated assets of approximately $44.2 billion and consolidated
shareholders' equity of approximately $7.4 billion. More information about XL
Capital Ltd is available at www.xlcapital.com.

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