Information provided in connection with outstanding debt of subsidiaries

The following tables present condensed consolidating financial information at September 30, 2012 and December 31, 2011, and for the three and nine months ended September 30, 2012 and 2011, for ACE Limited (the Parent Guarantor) and ACE INA Holdings Inc. (the Subsidiary Issuer). The Subsidiary Issuer is an indirect 100 percent-owned subsidiary of the Parent Guarantor. Investments in subsidiaries are accounted for by the Parent Guarantor under the equity method for purposes of the supplemental consolidating presentation. Earnings of subsidiaries are reflected in the Parent Guarantor’s investment accounts and earnings. The Parent Guarantor fully and unconditionally guarantees certain of the debt of the Subsidiary Issuer. Condensed consolidating financial information of the Subsidiary Issuer is presented on a consolidated basis and consists principally of the net assets, results of operations, and cash flows of operating insurance company subsidiaries.

Condensed Consolidating Balance Sheet at September 30, 2012

(in millions of U.S. dollars)



	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)		Other ACE Limited Subsidiaries and Eliminations⁽¹⁾			Consolidating Adjustments⁽²⁾			ACE Limited Consolidated
Assets
Investments	$	31		$	31,249	$	28,537		$	—		$	59,817
Cash⁽³⁾	(116		)	550		256			—			690
Insurance and reinsurance balances receivable	—			4,767		521			—			5,288
Reinsurance recoverable on losses and loss expenses	—			16,943		(5,086		)	—			11,857
Reinsurance recoverable on policy benefits	—			1,196		(950		)	—			246
Value of business acquired	—			628		4			—			632
Goodwill and other intangible assets	—			4,415		575			—			4,990
Investments in subsidiaries	26,998			—		—			(26,998		)	—
Due from subsidiaries and affiliates, net	270			—		—			(270		)	—
Other assets	16			7,711		2,261			—			9,988
Total assets	$	27,199		$	67,459	$	26,118		$	(27,268	)	$	93,508

Liabilities
Unpaid losses and loss expenses	$	—		$	31,640	$	6,560		$	—		$	38,200
Unearned premiums	—			5,973		1,095			—			7,068
Future policy benefits	—			3,819		595			—			4,414
Due to subsidiaries and affiliates, net	—			584		(314		)	(270		)	—
Short-term debt	—			851		551			—			1,402
Long-term debt	—			3,360		—			—			3,360
Trust preferred securities	—			309		—			—			309
Other liabilities	236			8,992		2,564			—			11,792
Total liabilities	236			55,528		11,051			(270		)	66,545
Total shareholders’ equity	26,963			11,931		15,067			(26,998		)	26,963
Total liabilities and shareholders’ equity	$	27,199		$	67,459	$	26,118		$	(27,268	)	$	93,508

____________________


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


⁽²⁾	Includes ACE Limited parent company eliminations.

⁽³⁾

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

Condensed Consolidating Balance Sheet at December 31, 2011

(in millions of U.S. dollars)



	ACE Limited (Parent Guarantor)		ACE INA Holdings Inc. (Subsidiary Issuer)		Other ACE Limited Subsidiaries and Eliminations⁽¹⁾			Consolidating Adjustments⁽²⁾			ACE Limited Consolidated
Assets
Investments	$	33	$	28,848	$	26,795		$	—		$	55,676
Cash	106		382		126			—			614
Insurance and reinsurance balances receivable	—		3,944		443			—			4,387
Reinsurance recoverable on losses and loss expenses	—		17,146		(4,757		)	—			12,389
Reinsurance recoverable on policy benefits	—		941		(692		)	—			249
Value of business acquired	—		676		—			—			676
Goodwill and other intangible assets	—		4,248		551			—			4,799
Investments in subsidiaries	23,871		—		—			(23,871		)	—
Due from subsidiaries and affiliates, net	498		—		—			(498		)	—
Other assets	8		7,018		1,505			—			8,531
Total assets	$	24,516	$	63,203	$	23,971		$	(24,369	)	$	87,321

Liabilities
Unpaid losses and loss expenses	$	—	$	30,837	$	6,640		$	—		$	37,477
Unearned premiums	—		5,416		918			—			6,334
Future policy benefits	—		3,673		601			—			4,274
Due to subsidiaries and affiliates, net	—		316		182			(498		)	—
Short-term debt	—		850		401			—			1,251
Long-term debt	—		3,360		—			—			3,360
Trust preferred securities	—		309		—			—			309
Other liabilities	184		7,769		2,031			—			9,984
Total liabilities	184		52,530		10,773			(498		)	62,989
Total shareholders’ equity	24,332		10,673		13,198			(23,871		)	24,332
Total liabilities and shareholders’ equity	$	24,516	$	63,203	$	23,971		$	(24,369	)	$	87,321

____________________


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


⁽²⁾	Includes ACE Limited parent company eliminations.

Condensed Consolidating Statements of Operations and Comprehensive Income

For the Three Months Ended September 30, 2012

(in millions of U.S. dollars)



	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)		Other ACE Limited Subsidiaries and Eliminations⁽¹⁾			Consolidating Adjustments ⁽²⁾			ACE Limited Consolidated
Net premiums written	$	—		$	2,868	$	1,848		$	—		$	4,716
Net premiums earned	—			2,819		1,846			—			4,665
Net investment income	—			255		278			—			533
Equity in earnings of subsidiaries	616			—		—			(616		)	—
Net realized gains (losses) including OTTI	(4		)	11		(67		)	—			(60		)
Losses and loss expenses	—			1,977		1,070			—			3,047
Policy benefits	—			77		53			—			130
Policy acquisition costs and administrative expenses	16			587		525			—			1,128
Interest (income) expense	(8		)	67		4			—			63
Other (income) expense	(39		)	17		5			—			(17		)
Income tax expense	3			123		21			—			147
Net income	$	640		$	237	$	379		$	(616	)	$	640
Comprehensive income	$	1,316		$	593	$	23		$	(616	)	$	1,316

Condensed Consolidating Statements of Operations and Comprehensive Income

For the Three Months Ended September 30, 2011

(in millions of U.S. dollars)



	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)		Other ACE Limited Subsidiaries and Eliminations⁽¹⁾			Consolidating Adjustments ⁽²⁾		ACE Limited Consolidated
Net premiums written	$	—		$	2,581	$	1,762		$	—	$	4,343
Net premiums earned	—			2,700		1,790			—		4,490
Net investment income	—			281		283			—		564
Equity in earnings of subsidiaries	(63		)	—		—			63		—
Net realized gains (losses) including OTTI	2			28		(790		)	—		(760		)
Losses and loss expenses	—			1,782		963			—		2,745
Policy benefits	—			22		61			—		83
Policy acquisition costs and administrative expenses	14			631		544			—		1,189
Interest (income) expense	(9		)	66		5			—		62
Other (income) expense	(30		)	85		34			—		89
Income tax expense	3			146		16			—		165
Net income (loss)	$	(39	)	$	277	$	(340	)	$	63	$	(39	)
Comprehensive income (loss)	$	(189	)	$	355	$	(418	)	$	63	$	(189	)

____________________


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


⁽²⁾	Includes ACE Limited parent company eliminations.

Condensed Consolidating Statements of Operations and Comprehensive Income

For the Nine Months Ended September 30, 2012

(in millions of U.S. dollars)



	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)		Other ACE Limited Subsidiaries and Eliminations⁽¹⁾			Consolidating Adjustments ⁽²⁾			ACE Limited Consolidated
Net premiums written	$	—		$	7,293	$	5,125		$	—		$	12,418
Net premiums earned	—			6,967		4,862			—			11,829
Net investment income	1			777		836			—			1,614
Equity in earnings of subsidiaries	1,845			—		—			(1,845		)	—
Net realized gains (losses) including OTTI	18			71		(283		)	—			(194		)
Losses and loss expenses	—			4,484		2,486			—			6,970
Policy benefits	—			217		162			—			379
Policy acquisition costs and administrative expenses	42			1,883		1,428			—			3,353
Interest (income) expense	(25		)	191		21			—			187
Other (income) expense	(102		)	51		65			—			14
Income tax expense	8			327		70			—			405
Net income	$	1,941		$	662	$	1,183		$	(1,845	)	$	1,941
Comprehensive income	$	3,044		$	1,203	$	642		$	(1,845	)	$	3,044

Condensed Consolidating Statements of Operations and Comprehensive Income

For the Nine Months Ended September 30, 2011

(in millions of U.S. dollars)



	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)		Other ACE Limited Subsidiaries and Eliminations⁽¹⁾			Consolidating Adjustments ⁽²⁾			ACE Limited Consolidated
Net premiums written	$	—		$	6,910	$	4,832		$	—		$	11,742
Net premiums earned	—			6,863		4,693			—			11,556
Net investment income	1			825		851			—			1,677
Equity in earnings of subsidiaries	742			—		—			(742		)	—
Net realized gains (losses) including OTTI	—			32		(910		)	—			(878		)
Losses and loss expenses	—			4,521		2,713			—			7,234
Policy benefits	—			121		161			—			282
Policy acquisition costs and administrative expenses	50			1,839		1,488			—			3,377
Interest (income) expense	(27		)	199		15			—			187
Other (income) expense	(92		)	121		59			—			88
Income tax expense	7			323		52			—			382
Net income	$	805		$	596	$	146		$	(742	)	$	805
Comprehensive income (loss)	$	1,050		$	947	$	(205	)	$	(742	)	$	1,050

____________________


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


⁽²⁾	Includes ACE Limited parent company eliminations.

Condensed Consolidating Statement of Cash Flows

For the Nine Months Ended September 30, 2012

(in millions of U.S. dollars)



	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)			Other ACE Limited Subsidiaries and Eliminations⁽¹⁾			Consolidating Adjustments⁽²⁾			ACE Limited Consolidated
Net cash flows from operating activities	$	210		$	1,553		$	1,262		$	—		$	3,025
Cash flows from investing activities
Purchases of fixed maturities available for sale	—			(8,553		)	(9,103		)	—			(17,656		)
Purchases of fixed maturities held to maturity	—			(215		)	(2		)	—			(217		)
Purchases of equity securities	—			(65		)	(49		)	—			(114		)
Sales of fixed maturities available for sale	—			5,154			6,201			—			11,355
Sales of equity securities	—			48			9			—			57
Maturities and redemptions of fixed maturities available for sale	—			1,757			1,839			—			3,596
Maturities and redemptions of fixed maturities held to maturity	—			798			294			—			1,092
Net derivative instruments settlements	(1		)	(10		)	(347		)	—			(358		)
Advances from (to) affiliates	36			—			—			(36		)	—
Acquisition of subsidiaries (net of cash acquired of $8)	—			(98		)	—			—			(98		)
Capital contribution to subsidiary	—			—			(90		)	90			—
Other	—			(279		)	(60		)	—			(339		)
Net cash flows from (used for) investing activities	35			(1,463		)	(1,308		)	54			(2,682		)
Cash flows from financing activities
Dividends paid on Common Shares	(484		)	—			—			—			(484		)
Common Shares repurchased	—			—			(11		)	—			(11		)
Net proceeds from issuance of short-term debt	—			1			150			—			151
Proceeds from share-based compensation plans	17			—			56			—			73
Advances (to) from affiliates	—			(10		)	(26		)	36			—
Capital contribution from subsidiary	—			90			—			(90		)	—
Net cash flows from (used for) financing activities	(467		)	81			169			(54		)	(271		)
Effect of foreign currency rate changes on cash and cash equivalents	—			(3		)	7			—			4
Net increase (decrease) in cash	(222		)	168			130			—			76
Cash – beginning of period	106			382			126			—			614
Cash – end of period⁽³⁾	$	(116	)	$	550		$	256		$	—		$	690

____________________


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


⁽²⁾	Includes ACE Limited parent company eliminations.

⁽³⁾

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

Condensed Consolidating Statement of Cash Flows

For the Nine Months Ended September 30, 2011

(in millions of U.S. dollars)



	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)			Other ACE Limited Subsidiaries and Eliminations⁽¹⁾			Consolidating Adjustments⁽²⁾			ACE Limited Consolidated
Net cash flows from operating activities	$	652		$	1,219		$	1,807		$	(680	)	$	2,998
Cash flows from investing activities
Purchases of fixed maturities available for sale	—			(9,434		)	(10,134		)	—			(19,568		)
Purchases of fixed maturities held to maturity	—			(282		)	(3		)	—			(285		)
Purchases of equity securities	—			(149		)	(140		)	—			(289		)
Sales of fixed maturities available for sale	7			7,366			6,950			—			14,323
Sales of equity securities	—			347			17			—			364
Maturities and redemptions of fixed maturities available for sale	—			1,234			1,369			—			2,603
Maturities and redemptions of fixed maturities held to maturity	—			724			242			—			966
Net derivative instruments settlements	(2		)	(19		)	88			—			67
Capital contribution to subsidiary	(385		)	—			—			385			—
Advances from (to) affiliates	(90		)	—			—			90			—
Acquisition of subsidiaries (net of cash acquired of $81)	—			(357		)	(37		)	—			(394		)
Other	—			(469		)	152			—			(317		)
Net cash flows used for investing activities	(470		)	(1,039		)	(1,496		)	475			(2,530		)
Cash flows from financing activities
Dividends paid on Common Shares	(342		)	—			—			—			(342		)
Common Shares repurchased	—			—			(168		)	—			(168		)
Net proceeds from (repayments) issuance of short-term debt	(300		)	(150		)	400			—			(50		)
Proceeds from share-based compensation plans	82			—			—			—			82
Advances from (to) affiliates	—			35			55			(90		)	—
Dividends to parent company	—			—			(680		)	680			—
Capital contribution from parent	—			—			385			(385		)	—
Net cash flows from (used for) financing activities	(560		)	(115		)	(8		)	205			(478		)
Effect of foreign currency rate changes on cash and cash equivalents	—			2			2			—			4
Net (decrease) increase in cash	(378		)	67			305			—			(6		)
Cash – beginning of period⁽³⁾	308			573			(109		)	—			772
Cash – end of period⁽³⁾	$	(70	)	$	640		$	196		$	—		$	766

____________________


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


⁽²⁾	Includes ACE Limited parent company eliminations.

⁽³⁾

ACE maintains two notional multi-currency cash pools (Pools) with a third-party bank. Various ACE entities participate in one or the other of the Pools, pursuant to which credit and debit balances in individual ACE accounts are translated daily into a single currency and pooled on a notional basis. Individual ACE entities are permitted to overdraw on their individual accounts provided the overall Pool balances do not fall below zero. At September 30, 2011 and December 31, 2010, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.