Information provided in connection with outstanding debt of subsidiaries

The following tables present condensed consolidating financial information at September 30, 2015 and December 31, 2014, and for the three and nine months ended September 30, 2015 and 2014 for ACE Limited (Parent Guarantor) and ACE INA Holdings Inc. (Subsidiary Issuer). The Subsidiary Issuer is an indirect 100 percent-owned subsidiary of the Parent Guarantor. The Parent Guarantor fully and unconditionally guarantees certain of the debt of the Subsidiary Issuer. Condensed consolidating financial information of the Parent Guarantor and Subsidiary Issuer are presented on the equity method of accounting. The revenues and expenses and cash flows of the subsidiaries of the Subsidiary Issuer are presented in the Other ACE Limited Subsidiaries column on a combined basis.

Condensed Consolidating Balance Sheet at September 30, 2015



(in millions of U.S. dollars)	ACE Limited (Parent Guarantor)		ACE INA Holdings Inc. (Subsidiary Issuer)		Other ACE Limited Subsidiaries		Consolidating Adjustments and Eliminations			ACE Limited Consolidated
Assets
Investments	$	29	$	35	$	62,320	$	—		$	62,384
Cash ⁽¹⁾	17		5		2,177		(1,161		)	1,038
Insurance and reinsurance balances receivable	—		—		6,284		(994		)	5,290
Reinsurance recoverable on losses and loss expenses	—		—		20,039		(8,808		)	11,231
Reinsurance recoverable on policy benefits	—		—		1,148		(954		)	194
Value of business acquired	—		—		410		—			410
Goodwill and other intangible assets	—		—		5,713		—			5,713
Investments in subsidiaries	29,441		19,184		—		(48,625		)	—
Due from subsidiaries and affiliates, net	866		—		—		(866		)	—
Other assets	9		272		14,880		(3,661		)	11,500
Total assets	$	30,362	$	19,496	$	112,971	$	(65,069	)	$	97,760
Liabilities
Unpaid losses and loss expenses	$	—	$	—	$	45,810	$	(8,246	)	$	37,564
Unearned premiums	—		—		10,329		(1,819		)	8,510
Future policy benefits	—		—		5,730		(954		)	4,776
Due to subsidiaries and affiliates, net	—		698		168		(866		)	—
Affiliated notional cash pooling programs ⁽¹⁾	973		188		—		(1,161		)	—
Short-term debt	—		700		1,403		—			2,103
Long-term debt	—		4,145		12		—			4,157
Trust preferred securities	—		309		—		—			309
Other liabilities	262		1,458		12,892		(3,398		)	11,214
Total liabilities	1,235		7,498		76,344		(16,444		)	68,633
Total shareholders’ equity	29,127		11,998		36,627		(48,625		)	29,127
Total liabilities and shareholders’ equity	$	30,362	$	19,496	$	112,971	$	(65,069	)	$	97,760

⁽¹⁾

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, 2015, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.

Condensed Consolidating Balance Sheet at December 31, 2014



(in millions of U.S. dollars)	ACE Limited (Parent Guarantor)		ACE INA Holdings Inc. (Subsidiary Issuer)		Other ACE Limited Subsidiaries		Consolidating Adjustments and Eliminations			ACE Limited Consolidated
Assets
Investments	$	30	$	225	$	62,649	$	—		$	62,904
Cash ⁽¹⁾	—		1		1,209		(555		)	655
Insurance and reinsurance balances receivable	—		—		6,178		(752		)	5,426
Reinsurance recoverable on losses and loss expenses	—		—		20,992		(9,000		)	11,992
Reinsurance recoverable on policy benefits	—		—		1,194		(977		)	217
Value of business acquired	—		—		466		—			466
Goodwill and other intangible assets	—		—		5,724		—			5,724
Investments in subsidiaries	29,497		18,762		—		(48,259		)	—
Due from subsidiaries and affiliates, net	583		—		—		(583		)	—
Other assets	4		295		14,196		(3,631		)	10,864
Total assets	$	30,114	$	19,283	$	112,608	$	(63,757	)	$	98,248
Liabilities
Unpaid losses and loss expenses	$	—	$	—	$	46,770	$	(8,455	)	$	38,315
Unearned premiums	—		—		9,958		(1,736		)	8,222
Future policy benefits	—		—		5,731		(977		)	4,754
Due to subsidiaries and affiliates, net	—		422		161		(583		)	—
Affiliated notional cash pooling programs ⁽¹⁾	246		309		—		(555		)	—
Short-term debt	—		1,150		1,402		—			2,552
Long-term debt	—		3,345		12		—			3,357
Trust preferred securities	—		309		—		—			309
Other liabilities	281		1,404		12,659		(3,192		)	11,152
Total liabilities	527		6,939		76,693		(15,498		)	68,661
Total shareholders’ equity	29,587		12,344		35,915		(48,259		)	29,587
Total liabilities and shareholders’ equity	$	30,114	$	19,283	$	112,608	$	(63,757	)	$	98,248

⁽¹⁾

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 December 31, 2014, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.

Condensed Consolidating Statements of Operations and Comprehensive Income



For the Three Months Ended September 30, 2015	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)			Other ACE Limited Subsidiaries			Consolidating Adjustments and Eliminations			ACE Limited Consolidated
(in millions of U.S. dollars)	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)			Other ACE Limited Subsidiaries			Consolidating Adjustments and Eliminations			ACE Limited Consolidated
Net premiums written	$	—		$	—		$	4,709		$	—		$	4,709
Net premiums earned	—			—			4,719			—			4,719
Net investment income	1			1			547			—			549
Equity in earnings of subsidiaries	488			255			—			(743		)	—
Net realized gains (losses) including OTTI	—			(4		)	(393		)	—			(397		)
Losses and loss expenses	—			—			2,643			—			2,643
Policy benefits	—			—			89			—			89
Policy acquisition costs and administrative expenses	15			7			1,317			—			1,339
Interest (income) expense	(8		)	68			8			—			68
Other (income) expense	(51		)	(5		)	68			—			12
Amortization of intangible assets	—			—			51			—			51
Chubb integration expenses	1			8			—			—			9
Income tax expense (benefit)	4			(31		)	159			—			132
Net income	$	528		$	205		$	538		$	(743	)	$	528
Comprehensive income (loss)	$	(271	)	$	(265	)	$	(262	)	$	527		$	(271	)

Condensed Consolidating Statements of Operations and Comprehensive Income



For the Three Months Ended September 30, 2014	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)			Other ACE Limited Subsidiaries			Consolidating Adjustments and Eliminations			ACE Limited Consolidated
(in millions of U.S. dollars)	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)			Other ACE Limited Subsidiaries			Consolidating Adjustments and Eliminations			ACE Limited Consolidated
Net premiums written	$	—		$	—		$	4,729		$	—		$	4,729
Net premiums earned	—			—			4,754			—			4,754
Net investment income	1			—			565			—			566
Equity in earnings of subsidiaries	745			258			—			(1,003		)	—
Net realized gains (losses) including OTTI	—			46			(166		)	—			(120		)
Losses and loss expenses	—			—			2,684			—			2,684
Policy benefits	—			—			125			—			125
Policy acquisition costs and administrative expenses	18			6			1,355			—			1,379
Interest (income) expense	(7		)	68			9			—			70
Other (income) expense	(54		)	2			6			—			(46		)
Amortization of intangible assets	—			—			27			—			27
Income tax expense (benefit)	4			(11		)	183			—			176
Net income	$	785		$	239		$	764		$	(1,003	)	$	785
Comprehensive income	$	298		$	33		$	276		$	(309	)	$	298

Condensed Consolidating Statements of Operations and Comprehensive Income



For the Nine Months Ended September 30, 2015	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)			Other ACE Limited Subsidiaries			Consolidating Adjustments and Eliminations			ACE Limited Consolidated
(in millions of U.S. dollars)	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)			Other ACE Limited Subsidiaries			Consolidating Adjustments and Eliminations			ACE Limited Consolidated
Net premiums written	$	—		$	—		$	13,569		$	—		$	13,569
Net premiums earned	—			—			13,006			—			13,006
Net investment income	2			2			1,658			—			1,662
Equity in earnings of subsidiaries	2,037			755			—			(2,792		)	—
Net realized gains (losses) including OTTI	—			(6		)	(354		)	—			(360		)
Losses and loss expenses	—			—			7,182			—			7,182
Policy benefits	—			—			384			—			384
Policy acquisition costs and administrative expenses	47			20			3,838			—			3,905
Interest (income) expense	(23		)	206			24			—			207
Other (income) expense	(149		)	(12		)	100			—			(61		)
Amortization of intangible assets	—			—			136			—			136
Chubb integration expenses	1			8			—			—			9
Income tax expense (benefit)	12			(84		)	467			—			395
Net income	$	2,151		$	613		$	2,179		$	(2,792	)	$	2,151
Comprehensive income (loss)	$	768		$	(332	)	$	795		$	(463	)	$	768

Condensed Consolidating Statements of Operations and Comprehensive Income



For the Nine Months Ended September 30, 2014	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)			Other ACE Limited Subsidiaries			Consolidating Adjustments and Eliminations			ACE Limited Consolidated
(in millions of U.S. dollars)	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)			Other ACE Limited Subsidiaries			Consolidating Adjustments and Eliminations			ACE Limited Consolidated
Net premiums written	$	—		$	—		$	13,473		$	—		$	13,473
Net premiums earned	—			—			13,056			—			13,056
Net investment income	2			1			1,672			—			1,675
Equity in earnings of subsidiaries	2,192			669			—			(2,861		)	—
Net realized gains (losses) including OTTI	—			53			(350		)	—			(297		)
Losses and loss expenses	—			—			7,233			—			7,233
Policy benefits	—			—			383			—			383
Policy acquisition costs and administrative expenses	57			20			3,889			—			3,966
Interest (income) expense	(26		)	209			30			—			213
Other (income) expense	(146		)	22			(15		)	—			(139		)
Amortization of intangible assets	—			—			78			—			78
Income tax expense (benefit)	11			(66		)	457			—			402
Net income	$	2,298		$	538		$	2,323		$	(2,861	)	$	2,298
Comprehensive income	$	2,754		$	810		$	2,778		$	(3,588	)	$	2,754

Condensed Consolidating Statement of Cash Flows



For the Nine Months Ended September 30, 2015	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)			Other ACE Limited Subsidiaries			Consolidating Adjustments and Eliminations			ACE Limited Consolidated
(in millions of U.S. dollars)
Net cash flows from (used for) operating activities	$	350		$	(46	)	$	2,671		$	(276	)	$	2,699
Cash flows from investing activities
Purchases of fixed maturities available for sale	—			—			(13,052		)	(8		)	(13,060		)
Purchases of fixed maturities held to maturity	—			—			(39		)	—			(39		)
Purchases of equity securities	—			—			(122		)	—			(122		)
Sales of fixed maturities available for sale	—			—			5,233			—			5,233
Sales of equity securities	—			—			150			—			150
Maturities and redemptions of fixed maturities available for sale	—			—			5,257			—			5,257
Maturities and redemptions of fixed maturities held to maturity	—			—			552			—			552
Net change in short-term investments	—			215			206			—			421
Net derivative instruments settlements	—			(10		)	72			—			62
Acquisition of subsidiaries (net of cash acquired of $620)	—			—			259			—			259
Capital contribution	—			(625		)	—			625			—
Other	—			(25		)	(121		)	8			(138		)
Net cash flows used for investing activities	—			(445		)	(1,605		)	625			(1,425		)
Cash flows from financing activities
Dividends paid on Common Shares	(644		)	—			—			—			(644		)
Common Shares repurchased	—			—			(758		)	—			(758		)
Proceeds from issuance of long-term debt	—			800			—			—			800
Proceeds from issuance of short-term debt	—			—			1,478			—			1,478
Repayment of long-term debt	—			(450		)	(1		)	—			(451		)
Repayment of short-term debt	—			—			(1,477		)	—			(1,477		)
Proceeds from share-based compensation plans, including windfall tax benefits	—			—			89			—			89
Dividend to parent company	—			—			(276		)	276			—
Advances (to) from affiliates	(416		)	272			144			—			—
Capital contribution	—			—			625			(625		)	—
Net proceeds from (payments to) affiliated notional cash pooling programs⁽¹⁾	727			(121		)	—			(606		)	—
Policyholder contract deposits	—			—			351			—			351
Policyholder contract withdrawals	—			—			(159		)	—			(159		)
Other	—			(6		)	—			—			(6		)
Net cash flows (used for) from financing activities	(333		)	495			16			(955		)	(777		)
Effect of foreign currency rate changes on cash and cash equivalents	—			—			(114		)	—			(114		)
Net increase in cash	17			4			968			(606		)	383
Cash – beginning of period⁽¹⁾	—			1			1,209			(555		)	655
Cash – end of period⁽¹⁾	$	17		$	5		$	2,177		$	(1,161	)	$	1,038

⁽¹⁾

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, 2015 and December 31, 2014, 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, 2014	ACE Limited (Parent Guarantor)			ACE INA Holdings Inc. (Subsidiary Issuer)			Other ACE Limited Subsidiaries			Consolidating Adjustments and Eliminations			ACE Limited Consolidated
(in millions of U.S. dollars)
Net cash flows from operating activities	$	168		$	139		$	3,115		$	(200	)	$	3,222
Cash flows from investing activities
Purchases of fixed maturities available for sale	—			—			(11,870		)	3			(11,867		)
Purchases of fixed maturities held to maturity	—			—			(185		)	—			(185		)
Purchases of equity securities	—			—			(222		)	—			(222		)
Sales of fixed maturities available for sale	—			—			6,309			(3		)	6,306
Sales of equity securities	—			—			322			—			322
Maturities and redemptions of fixed maturities available for sale	—			—			4,814			—			4,814
Maturities and redemptions of fixed maturities held to maturity	—			—			617			—			617
Net change in short-term investments	1			(16		)	(969		)	—			(984		)
Net derivative instruments settlements	—			53			(223		)	—			(170		)
Acquisition of subsidiaries (net of cash acquired of $4)	—			—			(172		)	—			(172		)
Capital contribution	—			(230		)	—			230			—
Other	—			(9		)	(138		)	—			(147		)
Net cash flows from (used for) investing activities	1			(202		)	(1,717		)	230			(1,688		)
Cash flows from financing activities
Dividends paid on Common Shares	(646		)	—			—			—			(646		)
Common Shares repurchased	—			—			(1,007		)	—			(1,007		)
Proceeds from issuance of long-term debt	—			699			—			—			699
Proceeds from issuance of short-term debt	—			—			1,827			—			1,827
Repayment of long-term debt	—			(500		)	(1		)	—			(501		)
Repayment of short-term debt	—			—			(1,827		)	—			(1,827		)
Proceeds from share-based compensation plans, including windfall tax benefits	—			—			94			—			94
Dividend to parent company	—			—			(200		)	200			—
Advances (to) from affiliates	97			(166		)	69			—			—
Capital contribution	—			—			230			(230		)	—
Net proceeds from (payments to) affiliated notional cash pooling programs⁽¹⁾	388			32			—			(420		)	—
Policyholder contract deposits	—			—			189			—			189
Policyholder contract withdrawals	—			—			(62		)	—			(62		)
Other	—			(6		)	—			—			(6		)
Net cash flows (used for) from financing activities	(161		)	59			(688		)	(450		)	(1,240		)
Effect of foreign currency rate changes on cash and cash equivalents	—			—			(67		)	—			(67		)
Net increase (decrease) in cash	8			(4		)	643			(420		)	227
Cash – beginning of period⁽¹⁾	—			16			748			(185		)	579
Cash – end of period⁽¹⁾	$	8		$	12		$	1,391		$	(605	)	$	806

⁽¹⁾

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, 2014 and December 31, 2013, the cash balance of one or more entities was negative; however, the overall Pool balances were positive.