8-K

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)—February 4, 2004

ACE LIMITED

(Exact name of registrant as specified in its charter)

Cayman Islands	1-11778	98-0091805
(State or other jurisdiction)	(Commission File Number)	(I.R.S. Employer of Incorporation Identification No.)

ACE Global Headquarters

17 Woodbourne Avenue

Hamilton HM 08 Bermuda

(Address of principal executive offices)

Registrant’s telephone number, including area code: (441) 295-5200

Not applicable

(Former name or former address, if changed since last report)

Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.

(c) Exhibits

Exhibit Number	Description
99.1	Press release, dated February 4, 2004, reporting year-end, fourth quarter results
99.2	Fourth quarter Financial Supplement

Item 12. Results of Operations and Financial Condition

On February 4, 2004, ACE Limited issued a press release reporting its year-end, fourth quarter 2003 results and the availability of its fourth 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.

In accordance with general instruction B.6 of Form 8-K, the information in this report, including exhibits, is furnished pursuant to Item 12 and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section.

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: February 4, 2004

EXHIBIT INDEX

Number	Description	Method of Filing
99.1	Press release, dated February 4, 2004, reporting year-end, fourth quarter results	Furnished herewith
99.2	Fourth quarter Financial Supplement	Furnished herewith

EX-99.1

Exhibit 99.1

	ACE Limited	PO Box HM 1015
	ACE Global Headquarters	Hamilton HM DX
	17 Woodbourne Avenue	Bermuda	News
	Hamilton HM 08		Release
	Bermuda	441 295-5200 main
		441 292-8675 fax
		www.acelimited.com

FOR IMMEDIATE RELEASE

Investor Contact:	Helen M. Wilson
	(441) 299-9283
Media Contact:	Anna Lowry
	(441) 278-6683

ACE LIMITED REPORTS RECORD YEAR-END, FOURTH QUARTER RESULTS

HAMILTON, Bermuda, February 4, 2004—ACE Limited (NYSE: ACE) today reported that net income for 2003 was a record $1.4 billion or $4.93 per share, compared with net income of $77 million or $0.19 per share for the prior year. Income excluding net realized gains (losses) on investments for 2003 was up 142% to a record $1.2 billion, or $4.21 per share, compared with $494 million or $1.74 per share for last year. ⁽¹⁾ The prior year included a charge of $354 million in the fourth quarter related to asbestos and environmental reserves.

For the quarter ended December 31, 2003, net income was $421 million or $1.45 per share, compared with a net loss of $168 million or $0.67 per share for the prior year. Income excluding net realized gains (losses) on investments for the fourth quarter of 2003 was a record $328 million, or $1.12 per share, compared with a loss of $99 million or $0.41 per share for the same quarter last year. ⁽¹⁾

Brian Duperreault, Chairman and Chief Executive Officer of ACE Limited, commented: “The record results of 2003 reflect the significant earnings power that ACE has built up over the last three years. With annual net income substantially in excess of $1 billion, ACE has established a preeminent presence in the global property and casualty insurance industry. As we look ahead to 2004, we view our prospects for further growth with continued optimism.”

Other 2003 operating highlights were as follows:

• Net premiums written increased 27% to $10.2 billion, reflecting P&C net premium growth of 40%

• The P&C combined ratio was 91.1% for the year compared with 103.0% a year ago

• Operating cash flow amounted to a record $4.2 billion for the year

• Cash and invested assets increased by $5.3 billion

• Net investment income increased 7% to $861 million

• Shareholders’ equity increased 38% to $8.8 billion

• Tangible equity rose to $6.1 billion, a gain of 66% from year-end 2002

• Debt to total capital ratio improved to 16.9% from 20.9% at year-end 2002

• Return on equity for 2003 was a record 15.8%; excluding FAS 115, it was 17.2%

• Diluted book value per share as of December 31, 2003 increased 22% to $29.38⁽²⁾

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Financial results improved over the prior year’s results for virtually every business segment. Further details are available in the financial supplement. Key items include:

• Insurance-North American: Net premiums written increased 38% and the combined ratio improved to 90.6%.

• Insurance-Overseas General: Net premiums written also increased 38%. The segment’s combined ratio improved to 93.0%.

• Global Reinsurance: Net premiums written were up 58%, a result of our continued strategy to diversify our reinsurance operations into multi-line reinsurance. This segment had a combined ratio of 75.7%.

• Financial Services: Net income increased 254% for the year reflecting a combined ratio of 94.4%.

As previously disclosed on December 2, 2003, ACE Limited intends to pursue an initial public offering of its financial guaranty business (ACE expects to offer approximately 65% to 75% of its interest in AGC Holdings Limited). The IPO is expected to be completed in the first half of 2004, subject to market conditions and receipt of various regulatory approvals.

Please refer to the ACE Financial Supplement December 31, 2003, which is posted on the Company’s website, for more detailed information on individual segment performance, together with additional disclosure on reinsurance recoverable, loss reserves, financial guaranty portfolio, investment portfolio and capital structure. ACE’s website reference (url) is http://media.corporate-ir.net/media_files/nys/ace/reports/fin_supp_december_31_2003.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 Limited (NYSE: ACE) will host its year-end, fourth quarter earnings conference call and webcast on Thursday, February 5, 2004 beginning at 8:30 a.m. EST. The call is available via live and archived webcast at www.acelimited.com or by dialing 1-973-582-2745. Please refer to our website in the “Investor Information, Calendar of Events” for details. A replay of the call will be available from Thursday, February 5, 2004 until Thursday, February 19, 2004 at 5:00 p.m. EST. To listen to the replay, dial: 1-877-519-4471 (in the United States) or 1-973-341-3080 (international); passcode 4434407.

The ACE Group of Companies is a global leader in insurance and reinsurance serving a diverse group of clients. A component of the Standard & Poor’s 500 stock index, ACE Group conducts its business on a worldwide basis with operating subsidiaries in nearly 50 countries. Additional information can be found at: http://www.acelimited.com.

¹ Income (loss) excluding net realized gains (losses) on investments and the tax effect of net realized gains (losses) on investments is a common performance measurement. 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) on investments because the amount of these gains (losses) is heavily influenced by, and fluctuates in part according to, the availability of market opportunities. This measure should not be viewed as a substitute for net income determined in accordance with generally accepted accounting principles (GAAP).

² Diluted book value per ordinary share is ordinary shareholders’ equity and net proceeds from assumed conversions of outstanding in-the-money options divided by the sum of shares outstanding and the number of options assumed issued.

Page 2/6

Cautionary Statement Regarding Forward-Looking Statements:

Any forward-looking statements made in this press release reflect the Company’s current views with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties, which may cause actual results to differ materially from those, set forth in these statements. For example, the Company’s forward-looking statements could be affected by competition, pricing and policy term trends, the levels of new and renewal business achieved, market acceptance, changes in demand, the frequency of unpredictable catastrophic events, actual loss experience, uncertainties in the reserving or settlement process, new theories of liability, planned public offerings, judicial and legislative developments, litigation tactics, the amount and timing of reinsurance recoverable, 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 3/6

ACE Limited

Summary Consolidated Balance Sheets

(in millions of U.S. dollars)

	December 31 2003		December 31 2002
	(Unaudited)
Assets
Total investments and cash	$	24,008	$	18,709
Insurance and reinsurance balances receivable		2,837		2,654
Reinsurance recoverable		14,081		13,991
Other assets		8,598		8,600
Total assets	$	49,524	$	43,954
Liabilities
Unpaid losses and loss expenses	$	27,155	$	24,315
Unearned premiums		6,051		5,586
Other liabilities		7,506		7,353
Total liabilities	$	40,712	$	37,254
Commitments and contingencies
Mezzanine equity	$	—	$	311
Shareholders’ equity
Total shareholders’ equity	$	8,812	$	6,389
Total liabilities, mezzanine equity and shareholders’ equity	$	49,524	$	43,954
Diluted book value per ordinary share (2)	$	29.38	$	24.16

Page 4/6

ACE Limited

Summary Consolidated Financial Data

(in millions of U.S. dollars, except share, per share data, and ratios)

(Unaudited)

	Three Months Ended December 31						Years Ended December 31
	2003			2002			2003			2002
Gross premiums written	$	3,668		$	3,244		$	14,637		$	12,819
Net premiums written		2,573			1,984			10,215			8,068
Net premiums earned		2,827			1,969			9,602			6,830
Losses and loss expenses		1,857			1,764			6,118			4,906
Life and annuity benefits		44			52			181			158
Policy acquisition costs		384			275			1,357			960
Administrative expenses		320			266			1,160			944
Underwriting income (loss)		222			(388	)		786			(138	)
Net investment income		228			202			861			802
Other income (expense)		(19	)		1			(27	)		(21	)
Interest expense		44			47			177			193
Income tax expense (benefit)		59			(133	)		246			(44	)
Income (loss) excluding net realized gains (losses) (1)		328			(99	)		1,197			494
Net realized gains (losses)		105			(88	)		229			(489	)
Tax effect of net realized gains (losses)		(12	)		19			(32	)		72
Net income (loss)		421			(168	)		1,394			77
Preference shares dividend		(11	)		—			(26	)		—
FELINE PRIDE dividend		—			(7	)		(10	)		(26	)
Net income (loss) available to holders of ordinary shares	$	410		$	(175	)	$	1,358		$	51
Diluted earnings per share:
Income (loss) excluding net realized gains (losses) (1)	$	1.12		$	(0.41	)	$	4.21		$	1.74
Net income (loss)	$	1.45		$	(0.67	)	$	4.93		$	0.19
Weighted average diluted shares outstanding		282,647,642			260,965,129			275,655,969			269,870,023
Loss and loss expense ratio		66.8	%		91.8	%		65.0	%		73.5	%
Policy acquisition cost ratio		13.6	%		14.3	%		14.2	%		14.2	%
Administrative expense ratio		11.5	%		13.7	%		12.3	%		14.0	%
Combined ratio		91.9	%		119.8	%		91.5	%		101.7	%

Ratios exclude life reinsurance business

Page 5/6

ACE Limited

Consolidated Supplemental Segment Information

(in millions of U.S. dollars)

(Unaudited)

	Three Months Ended December 31						Years Ended December 31
	2003			2002			2003			2002
Gross Premiums Written
Insurance—North American	$	1,764		$	1,640		$	6,895		$	6,116
Insurance—Overseas General		1,341			1,203			5,191			4,114
Global Reinsurance*		274			163			1,505			1,052
Financial Services		289			238			1,046			1,537
Total	$	3,668		$	3,244		$	14,637		$	12,819
Net Premiums Written
Insurance—North American	$	1,048		$	819		$	4,015		$	2,919
Insurance—Overseas General		982			796			3,751			2,716
Global Reinsurance*		267			141			1,410			936
Financial Services		276			228			1,039			1,497
Total	$	2,573		$	1,984		$	10,215		$	8,068
Net Premiums Earned
Insurance—North American	$	991		$	742		$	3,654		$	2,475
Insurance—Overseas General		1,007			671			3,563			2,393
Global Reinsurance*		357			264			1,284			835
Financial Services		472			292			1,101			1,127
Total	$	2,827		$	1,969		$	9,602		$	6,830
Income (Loss) Excluding Net Realized Gains (Losses)(1)
Insurance—North American	$	153		$	(236	)	$	532		$	97
Insurance—Overseas General		94			72			315			116
Global Reinsurance*		95			72			361			296
Financial Services		57			50			231			202
Corporate		(71	)		(57	)		(242	)		(217	)
Total	$	328		$	(99	)	$	1,197		$	494

* Includes both property and casualty reinsurance and life reinsurance

# # #

Page 6/6

EX-99.2

Exhibit 99.2

Financial Supplement

December 31, 2003

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 concerning reserves and recoverables could be affected by the frequency of unpredictable catastrophic events, actual loss experience which differs from the Company’s assumptions, uncertainties in the reserving or settlement process, new theories of liability, planned public offerings, judicial and legislative developments, litigation tactics, credit developments among reinsurers and other factors identified in the Company’s filings with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the year ended December 31, 2002, the Company’s quarterly reports on Form 10-Q for the quarters ended March 31, 2003, June 30, 2003 and September 30, 2003 and in the Company’s earnings press release, which are available on the Company’s website.
	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	2-3
	- Computation of Basic and Diluted Earnings Per Share	4
	- Summary Consolidated Balance Sheets	5
	- Consolidated Premiums by Line of Business	6
	- Consolidating Statement of Operations	7-8
III.	Segment Results
	- Insurance-North American	9
	- Insurance-Overseas General	10-11
	- Global Reinsurance	12-13
	- Financial Services	14-15
	- Financial Guaranty Profile	16-17
	- Financial Services Portfolio	18-21
IV.	Balance Sheet Details
	- Loss Reserve Rollforward	22
	- Asbestos and Environmental Reserves	23
	- Reinsurance Recoverable Analysis	24-27
	- Investment Portfolio	28-29
	- Realized and Unrealized Gains (Losses)	30
	- Capital Structure	31
V.	Other Disclosures
	- Non-GAAP Financial Measures	32
	- Diluted Book Value per Ordinary Share	33
	- Statutory Accounting Principles to GAAP Reconciliation and Comprehensive Income	34
	- Glossary	35

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

	Three months ended Dec. 31						% Change 4Q-03 vs. 4Q-02		Year ended Dec. 31						% Change 2003 vs. 2002
	2003			2002					2003			2002
Gross premiums written	$	3,668		$	3,244		14	%	$	14,637		$	12,819		14	%
Net premiums written	$	2,523		$	1,984		32	%	$	10,215		$	8,068		27	%
Net premiums earned	$	2,827		$	1,969		45	%	$	9,602		$	6,830		41	%
Net investment income	$	228		$	202		13	%	$	861		$	802		7	%
Income (loss) excluding net realized gains (losses)	$	328		$	(99	)	NM		$	1,197		$	494		142	%
Net income (loss)	$	421		$	(168	)	NM		$	1,394		$	77		NM
Comprehensive income (loss)	$	473		$	(13	)	NM		$	1,674		$	415		303	%
Operating cash flow	$	1,586		$	833		90	%	$	4,224		$	2,424		74	%
Combined ratio
Loss and loss expense ratio		66.8	%		91.8	%				65.0	%		73.5	%
Underwriting and administrative expense ratio		25.1	%		28.0	%				26.5	%		28.2	%
Combined ratio		91.9	%		119.8	%				91.5	%		101.7	%
Annualized ROE*		15.8	%		-6.6	%				15.8	%		7.5	%
Annualized ROE, excluding FAS 115		17.3	%		-7.1	%				17.2	%		7.9	%
Diluted earnings per share
Income (loss) excluding net realized gains (losses)	$	1.12		$	(0.41	)	NM		$	4.21		$	1.74		142	%
Net income (loss)	$	1.45		$	(0.67	)	NM		$	4.93		$	0.19		NM
Diluted book value per ordinary share	$	29.38		$	24.16		22	%	$	29.38		$	24.16		22	%
Diluted tangible book value per ordinary share	$	20.17		$	14.56		39	%	$	20.17		$	14.56		39	%
Weighted average diluted ordinary shares outstanding		282.6			260.9		8	%		275.7			269.9		2	%
Debt/ total capitalization		16.9	%		20.9	%				16.9	%		20.9	%

* Calculated using income (loss) excluding net realized gains (losses).

Page 1

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

ACE Limited Consolidated

	4Q-03			3Q-03			2Q-03			1Q-03			4Q-02			Full Year 2003			Full Year 2002
Consolidated Property and Casualty Excluding Financial Services(1)
Gross premiums written	$	3,330		$	3,295		$	3,241		$	3,532		$	2,956		$	13,398		$	11,117
Net premiums written		2,250			2,154			2,230			2,357			1,709			8,991			6,412
Net premiums earned		2,307			2,146			2,049			1,815			1,631			8,317			5,545
Losses and loss expenses		1,429			1,375			1,298			1,122			1,507			5,224			3,959
Policy acquisition costs		363			321			315			281			260			1,280			872
Administrative expenses		295			271			266			241			250			1,073			881
P& C underwriting income (loss)	$	220		$	179		$	170		$	171		$	(386	)	$	740		$	(167	)
Financial Services underwriting income		4			22			17			19			6			62			51
Life underwriting income (loss) excluding investment income		(2	)		(4	)		(5	)		(5	)		(8	)		(16	)		(22	)
Net investment income		228			216			211			206			202			861			802
Other income (expense)(2)		(19	)		(3	)		1			(6	)		1			(27	)		(21	)
Interest expense		44			45			43			45			47			177			193
Income tax expense (benefit)		59			61			65			61			(133	)		246			(44	)
Income (loss) excluding net realized gains (losses)	$	328		$	304		$	286		$	279		$	(99	)	$	1,197		$	494
Net realized gains (losses)		105			57			107			(40	)		(88	)		229			(489	)
Tax effect of net realized gains (losses)		(12	)		(6	)		(22	)		8			19			(32	)		72
Net income (loss)	$	421		$	355		$	371		$	247		$	(168	)	$	1,394		$	77
% Change versus prior year period(1)
Gross premiums written		13	%		11	%		25	%		36	%		44	%		21	%		34	%
Net premiums written		32	%		27	%		46	%		59	%		54	%		40	%		43	%
Net premiums earned		41	%		44	%		55	%		65	%		54	%		50	%		36	%
Other ratios(1)
Net premiums written/gross premiums written		68	%		65	%		69	%		67	%		58	%		67	%		58	%
Effective tax rate		15	%		17	%		19	%		18	%		57	%		17	%		-10	%
ROE
Annualized ROE		15.8	%		15.2	%		15.6	%		16.7	%		-6.6	%		15.8	%		7.5	%
Annualized ROE, excluding FAS 115		17.3	%		16.8	%		17.2	%		18.1	%		-7.1	%		17.2	%		7.9	%

⁽¹⁾ Consolidated property and casualty excluding financial services is presented to allow for comparison and analysis with earnings guidance.

⁽²⁾ Other income (expense) in Q2 and Q3 of 2002 includes debt prepayment expense. The tax effect in 2Q-02 was $4M and 3Q-02 was $5M.

Page 2

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

ACE Limited Consolidated

	4Q-03		3Q-03		2Q-03		1Q-03		4Q-02		Full Year 2003		Full Year 2002
Combined ratio
Loss and loss expense ratio	66.8	%	64.6	%	64.5	%	63.4	%	91.8	%	65.0	%	73.5	%
Policy acquisition cost ratio	13.6	%	14.4	%	14.6	%	14.4	%	14.3	%	14.2	%	14.2	%
Administrative expense ratio	11.5	%	12.4	%	12.6	%	12.8	%	13.7	%	12.3	%	14.0	%
Combined ratio	91.9	%	91.4	%	91.7	%	90.6	%	119.8	%	91.5	%	101.7	%

Consolidated Property and Casualty Excluding Financial Services⁽¹⁾

	4Q-03			3Q-03			2Q-03			1Q-03			4Q-02			Full Year 2003			Full Year 2002
Combined ratio
Loss and loss expense ratio		61.9	%		64.0	%		63.4	%		61.8	%		92.4	%		62.8	%		71.4	%
Policy acquisition cost ratio		15.8	%		15.0	%		15.3	%		15.5	%		15.9	%		15.4	%		15.7	%
Administrative expense ratio		12.8	%		12.6	%		13.0	%		13.3	%		15.4	%		12.9	%		15.9	%
Combined ratio		90.5	%		91.6	%		91.7	%		90.6	%		123.7	%		91.1	%		103.0	%
Large losses and other items
Catastrophe and other large losses	$	35		$	42		$	30		$	5		$	46		$	112		$	156
A&E loss		—			—			—			—			516	(2)		—			516	(2)
Prior period development(3)		14			62			21			24			71			121			164

⁽¹⁾ Consolidated property and casualty excluding financial services is presented to allow for comparison and analysis with earnings guidance.

⁽²⁾ Reported in press release on January 27, 2003.

⁽³⁾ Prior period development for the Financial Services segment for the fourth quarter 2003 is adverse $9 million, full year 2003 is adverse $8 million compared with adverse of $30 million in 2002.

Page 3

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

	Three months ended Dec. 31						Year ended Dec. 31
	2003			2002			2003			2002
Numerator
Income (loss) excluding net realized gains (losses)	$	328		$	(99	)	$	1,197		$	494
Perpetual preferred dividend		(11	)		—			(26	)		—
Mezzanine equity dividend		—			(7	)		(10	)		(26	)
Income (loss) to ordinary shares, excl. net realized gains (losses)		317			(106	)		1,161			468
Net realized gains (losses), net of income tax		93			(69	)		197			(417	)
Net income (loss) available to the holders of ordinary shares	$	410		$	(175	)	$	1,358		$	51
Rollforward of ordinary shares
Ordinary shares - beginning of period		278,480,910			262,495,210			262,679,356			259,861,205
Mezzanine equity conversion		—			—			11,814,274			—
Issued under employee stock purchase plan		326			—			288,726			252,619
Stock (cancelled) granted		(167,902	)		(91,317	)		898,869			332,547
Issued for option exercises		1,583,859			275,463			4,215,968			2,232,985
Ordinary shares - end of period		279,897,193			262,679,356			279,897,193			262,679,356
Denominator
Weighted average shares outstanding		276,705,797			260,965,129			270,620,114			260,535,836
Dilutive effect of mezzanine equity		—			2,000,832			—			2,874,870
Effect of other dilutive securities		5,941,845			5,954,476			5,035,855			6,459,317
Adj. wtd. avg. shares outstanding and assumed conversions		282,647,642			268,920,437			275,655,969			269,870,023
Basic earnings (loss) per share
Income (loss) excluding net realized gains (losses)	$	1.14		$	(0.41	)	$	4.29		$	1.80
Net realized gains (losses)		0.34			(0.26	)		0.73			(1.61	)
Net income (loss)	$	1.48		$	(0.67	)	$	5.02		$	0.19
Diluted earnings (loss) per share
Income (loss) excluding net realized gains (losses)	$	1.12		$	(0.41	)	$	4.21		$	1.74
Net realized gains (losses)		0.33			(0.26	)		0.72			(1.55	)
Net income (loss)	$	1.45		$	(0.67	)	$	4.93		$	0.19

Page 4

ACE Limited Summary Consolidated Balance Sheets (in millions of U.S. dollars)

	December 31 2003		September 30 2003		June 30 2003		March 31 2003		December 31 2002
	(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)		(Audited)
Assets
Fixed maturities available for sale, at fair value	$	18,645	$	17,413	$	16,884	$	15,044	$	14,420
Equity securities, at fair value		544		460		471		410		411
Securities on loan, at fair value		684		596		546		521		293
Short-term investments		2,928		2,931		2,840		2,101		2,270
Other investments, at fair value		645		665		661		685		652
Cash		562		431		576		477		663
Total investments and cash	$	24,008	$	22,496		21,978	$	19,238	$	18,709
Insurance and reinsurance balances receivable		2,837		2,821		3,186		3,228		2,654
Reinsurance recoverable		14,081		14,032		13,891		14,132		13,991
Deferred policy acquisition costs		1,005		998		984		915		832
Prepaid reinsurance premiums		1,372		1,370		1,452		1,790		1,721
Goodwill		2,711		2,711		2,711		2,711		2,717
Deferred tax assets		1,090		1,103		1,075		1,227		1,288
Other assets		2,420		2,258		2,242		2,271		2,042
Total assets	$	49,524	$	47,789		47,519	$	45,512	$	43,954
Liabilities
Unpaid losses and loss expenses	$	27,155	$	25,637	$	24,940	$	24,636	$	24,315
Unearned premiums		6,051		6,243		6,394		6,573		5,586
Future policy benefits for life and annuity contracts		492		479		470		459		442
Insurance and reinsurance balances payable		1,903		1,874		1,989		1,963		1,870
Deposit liabilities		212		125		74		89		90
Securities lending collateral		698		608		561		533		301
Payable for investments purchased		369		555		893		56		503
Accounts payable, accrued expenses and other liabilities		1,462		1,552		1,650		1,820		1,777
Short-term debt		146		146		146		146		146
Long-term debt		1,749		1,749		1,749		1,749		1,749
Trust preferred securities		475		475		475		475		475
Total liabilities	$	40,712	$	39,443	$	39,341	$	38,499	$	37,254
Mezzanine equity	$	—	$	—	$	—	$	311	$	311
Shareholders’ equity
Total shareholders’ equity, excl. AOCI	$	8,092	$	7,678	$	7,365	$	6,164	$	5,949
Accumulated other comprehensive income (AOCI)		720		668		813		538		440
Total shareholders’ equity	$	8,812	$	8,346	$	8,178	$	6,702	$	6,389
Total liabilities, mezzanine equity and shareholders’ equity	$	49,524	$	47,789	$	47,519	$	45,512	$	43,954
Diluted book value per ordinary share	$	29.38	$	27.76	$	27.24	$	25.14	$	24.16
Diluted tangible book value per ordinary share	$	20.17	$	18.43	$	17.91	$	15.72	$	14.56

Page 5

ACE Limited Consolidated Premiums by Line of Business (in millions of U.S. dollars) (Unaudited)

ACE Limited Consolidated

	Full Year 2003		% of Total Consolidated		Full Year 2002		% of Total Consolidated		% Change 2003 vs. 2002
Net premiums written
Property and all other	$	3,450	34	%	$	2,583	32	%	34	%
Casualty		4,592	45	%		3,123	38	%	47	%
Personal accident		949	9	%		706	9	%	34	%
Total P&C		8,991	88	%		6,412	79	%	40	%
Global Re - life		185	2	%		159	2	%	16	%
Financial guaranty		509	5	%		387	5	%	32	%
Financial solutions		530	5	%		1,110	14	%	-52	%
Total Consolidated	$	10,215	100	%	$	8,068	100	%	27	%

	Full Year 2003		% of Total Consolidated		Full Year 2002		% of Total Consolidated		% Change 2003 vs. 2002
Net premiums earned
Property and all other	$	3,279	34	%	$	2,255	33	%	45	%
Casualty		4,118	43	%		2,589	38	%	59	%
Personal accident		920	10	%		701	10	%	31	%
Total P&C		8,317	87	%		5,545	81	%	50	%
Global Re - life		184	2	%		158	2	%	16	%
Financial guaranty		328	3	%		282	4	%	16	%
Financial solutions		773	8	%		845	13	%	-9	%
Total Consolidated	$	9,602	100	%	$	6,830	100	%	41	%

Page 6

ACE Limited Consolidating Statement of Operations Three months ended December 31, 2003 and 2002 (in millions of U.S. dollars) (Unaudited)

	Insurance - North American			Insurance - Overseas General			Global Reinsurance			Corporate & Other			Consolidated P&C			Financial Services			ACE Consolidated
December 31, 2003
Gross premiums written	$	1,764		$	1,341		$	225		$	—		$	3,330		$	289		$	3,619
Net premiums written		1,048			982			220			—			2,250			276			2,526
Net premiums earned		991			1,007			309			—			2,307			472			2,779
Losses and loss expenses		660			603			166			—			1,429			428			1,857
Policy acquisition costs		108			197			58			—			363			16			379
Administrative expenses		109			130			17			39			295			24			319
Underwriting income (loss)	$	114		$	77		$	68		$	(39	)	$	220		$	4		$	224
Life underwriting income		—			—			6			—			6			—			6
Net investment income - property and casualty		104			46			24			(7	)		167			53			220
Other income (expense)		(8	)		(3	)		1			(9	)		(19	)		—			(19	)
Interest expense		7			2			—			34			43			1			44
Income tax expense (benefit)		50			24			4			(18	)		60			(1	)		59
Income (loss) excluding net realized gains (losses)	$	153		$	94		$	95		$	(71	)	$	271		$	57		$	328
Net realized gains (losses)		24			1			8			3			36			69			105
Tax effect of net realized gains (losses)		—			—			(1	)					(1	)		(11	)		(12	)
Net income (loss)	$	177		$	95		$	102		$	(68	)	$	306		$	115		$	421
December 31, 2002
Gross premiums written	$	1,640		$	1,203		$	113		$	—		$	2,956		$	238		$	3,194
Net premiums written		819			796			94			—			1,709			228			1,937
Net premiums earned		742			671			218			—			1,631			292			1,923
Losses and loss expenses		1,024			372			111			—			1,507			257			1,764
Policy acquisition costs		69			151			40			—			260			14			274
Administrative expenses		97			108			14			31			250			15			265
Underwriting income (loss)	$	(448	)	$	40		$	53		$	(31	)	$	(386	)	$	6		$	(380	)
Life underwriting income (loss)		—			—			—			—			—			—			—
Net investment income - property and casualty		100			31			19			(7	)		143			51			194
Other income (expense)		1			(1	)		—			—			—			1			1
Interest expense		8			1			—			36			45			2			47
Income tax expense (benefit)		(119	)		(3	)		—			(17	)		(139	)		6			(133	)
Income (loss) excluding net realized gains (losses)	$	(236	)	$	72		$	72		$	(57	)	$	(149	)	$	50		$	(99	)
Net realized gains (losses)		(92	)		(5	)		—			(1	)		(98	)		10			(88	)
Tax effect of net realized gains (losses)		27			2			—			—			29			(10	)		19
Net income (loss)	$	(301	)	$	69		$	72		$	(58	)	$	(218	)	$	50		$	(168	)

Page 7

ACE Limited Consolidating Statement of Operations Year ended December 31, 2003 and 2002 (in millions of U.S. dollars) (Unaudited)

	Insurance - North American			Insurance - Overseas General			Global Reinsurance			Corporate & Other			Consolidated P&C			Financial Services			ACE Consolidated
December 31, 2003
Gross premiums written	$	6,895		$	5,191		$	1,312		$	—		$	13,398		$	1,046		$	14,444
Net premiums written		4,015			3,751			1,225			—			8,991			1,039			10,030
Net premiums earned		3,654			3,563			1,100			—			8,317			1,101			9,418
Losses and loss expenses		2,521			2,144			559			—			5,224			894			6,118
Policy acquisition costs		387			682			211			—			1,280			61			1,341
Administrative expenses		402			486			62			123			1,073			84			1,157
Underwriting income (loss)	$	344		$	251		$	268		$	(123	)	$	740		$	62		$	802
Life underwriting income		—			—			17			—			17			—			17
Net investment income - property and casualty		410			159			87			(30	)		626			202			828
Other income (expense)		(14	)		(7	)		3			(9	)		(27	)		—			(27	)
Interest expense		29			4			—			138			171			6			177
Income tax expense (benefit)		179			84			14			(58	)		219			27			246
Income (loss) excluding net realized gains (losses)	$	532		$	315		$	361		$	(242	)	$	966		$	231		$	1,197
Net realized gains (losses)		39			(6	)		34			(5	)		62			167			229
Tax effect of net realized gains (losses)		—			5			—			—			5			(37	)		(32	)
Net income (loss)	$	571		$	314		$	395		$	(247	)	$	1,033		$	361		$	1,394
December 31, 2002
Gross premiums written	$	6,116		$	4,114		$	887		$	—		$	11,117		$	1,537		$	12,654
Net premiums written		2,919			2,716			777			—			6,412			1,497			7,909
Net premiums earned		2,475			2,393			677			—			5,545			1,127			6,672
Losses and loss expenses		2,200			1,455			304			—			3,959			947			4,906
Policy acquisition costs		216			533			123			—			872			72			944
Administrative expenses		341			390			40			110			881			57			938
Underwriting income (loss)	$	(282	)	$	15		$	210		$	(110	)	$	(167	)	$	51		$	(116	)
Life underwriting income		—			—			5			—			5			—			5
Net investment income - property and casualty		406			108			82			(13	)		583			192			775
Other income (expense)		1			2			1			(26	)		(22	)		1			(21	)
Interest expense		32			3			1			145			181			12			193
Income tax expense (benefit)		(4	)		6			1			(77	)		(74	)		30			(44	)
Income (loss) excluding net realized gains (losses)	$	97		$	116		$	296		$	(217	)	$	292		$	202		$	494
Net realized gains (losses)		(199	)		(37	)		(57	)		(79	)		(372	)		(117	)		(489	)
Tax effect of net realized gains (losses)		43			12			—			—			55			17			72
Net income (loss)	$	(59	)	$	91		$	239		$	(296	)	$	(25	)	$	102		$	77

Page 8

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

Insurance - North American

	4Q-03			3Q-03			2Q-03			1Q-03			4Q-02			Full Year 2003			Full Year 2002
Gross premiums written	$	1,764		$	1,819		$	1,648		$	1,664		$	1,640		$	6,895		$	6,116
Net premiums written		1,048			1,065			969			933			819			4,015			2,919
Net premiums earned		991			990			920			753			742			3,654			2,475
Losses and loss expenses		660			712			637			512			1,024			2,521			2,200
Policy acquisition costs		108			95			101			83			69			387			216
Administrative expenses		109			103			102			88			97			402			341
Underwriting income (loss)	$	114		$	80		$	80		$	70		$	(448	)	$	344		$	(282	)
Net investment income - property and casualty		104			100			103			103			100			410			406
Other income (expense)		(8	)		—			—			(6	)		1			(14	)		1
Interest expense		7			7			7			8			8			29			32
Income tax expense (benefit)		50			48			42			39			(119	)		179			(4	)
Income (loss) excluding net realized gains (losses)	$	153		$	125		$	134		$	120		$	(236	)	$	532		$	97
Net realized gains (losses)		24			8			25			(18	)		(92	)		39			(199	)
Tax effect of net realized gains (losses)		—			—			(3	)		3			27			—			43
Net income (loss)	$	177		$	133		$	156		$	105		$	(301	)	$	571		$	(59	)
Combined ratio
Loss and loss expense ratio		66.6	%		71.9	%		69.2	%		68.0	%		137.9	%		69.0	%		88.9	%
Policy acquisition cost ratio		10.9	%		9.6	%		10.9	%		11.0	%		9.4	%		10.6	%		8.7	%
Administrative expense ratio		11.1	%		10.4	%		11.1	%		11.6	%		13.0	%		11.0	%		13.8	%
Combined ratio		88.6	%		91.9	%		91.2	%		90.6	%		160.3	%		90.6	%		111.4	%
Large losses and other items
Large losses (before tax)	$	—		$	20		$	—		$	—		$	516	(1)	$	20		$	516	(1)
% Change versus prior year period
Gross premiums written		8	%		2	%		15	%		32	%		49	%		13	%		35	%
Net premiums written		28	%		23	%		35	%		82	%		75	%		38	%		47	%
Net premiums earned		34	%		51	%		52	%		59	%		63	%		48	%		36	%
Other ratios
Net premiums written/gross premiums written		59	%		59	%		59	%		56	%		50	%		58	%		48	%

⁽¹⁾ Reported in press release on January 27, 2003.

Page 9

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

Insurance - Overseas General

	4Q-03			3Q-03			2Q-03			1Q-03			4Q-02			Full Year 2003			Full Year 2002
Gross premiums written	$	1,341		$	1,200		$	1,244		$	1,406		$	1,203		$	5,191		$	4,114
Net premiums written		982			872			916			981			796			3,751			2,716
Net premiums earned		1,007			882			860			814			671			3,563			2,393
Losses and loss expenses		603			529			518			494			372			2,144			1,455
Policy acquisition costs		197			170			163			152			151			682			533
Administrative expenses		130			121			121			114			108			486			390
Underwriting income (loss)	$	77		$	62		$	58		$	54		$	40		$	251		$	15
Net investment income - property and casualty		46			40			38			35			31			159			108
Other income (expense)		(3	)		(3	)		—			(1	)		(1	)		(7	)		2
Interest expense		2			1			1			—			1			4			3
Income tax expense (benefit)		24			12			25			23			(3	)		84			6
Income (loss) excluding net realized gains (losses)	$	94		$	86		$	70		$	65		$	72		$	315		$	116
Net realized gains (losses)		1			4			2			(13	)		(5	)		(6	)		(37	)
Tax effect of net realized gains (losses)		—			—			—			5			2			5			12
Net income (loss)	$	95		$	90		$	72		$	57		$	69		$	314		$	91
Combined ratio
Loss and loss expense ratio		59.8	%		59.9	%		60.3	%		60.7	%		55.5	%		60.2	%		60.8	%
Policy acquisition cost ratio		19.6	%		19.3	%		18.9	%		18.7	%		22.4	%		19.2	%		22.3	%
Administrative expense ratio		12.9	%		13.7	%		14.0	%		14.0	%		16.2	%		13.6	%		16.3	%
Combined ratio		92.3	%		92.9	%		93.2	%		93.4	%		94.1	%		93.0	%		99.4	%
Large losses and other items
Large losses (before tax)	$	—		$	10		$	—		$	—		$	—		$	10		$	68
% Change versus prior year period
Gross premiums written		11	%		19	%		32	%		46	%		30	%		26	%		25	%
Net premiums written		23	%		26	%		49	%		60	%		28	%		38	%		26	%
Net premiums earned		50	%		36	%		52	%		60	%		31	%		49	%		23	%
Other ratios
Net premiums written/gross premiums written		73	%		73	%		74	%		70	%		66	%		72	%		66	%

Page 10

ACE Limited Segment Results - Consecutive Quarters - 2 (in millions of U.S. dollars) (Unaudited)

Insurance - Overseas General

	4Q-03			3Q-03			2Q-03			1Q-03			4Q-02			Full Year 2003			Full Year 2002
Gross premiums written
ACE Global Markets	$	458		$	351		$	422		$	346		$	511		$	1,577		$	1,451
ACE International		883			849			822			1,060			692		$	3,614			2,663
Total	$	1,341		$	1,200		$	1,244		$	1,406		$	1,203		$	5,191		$	4,114
Net premiums written
ACE Global Markets	$	294		$	253		$	295		$	256		$	282		$	1,098		$	787
ACE International		688			619			621			725			514		$	2,653			1,929
Total	$	982		$	872		$	916		$	981		$	796		$	3,751		$	2,716
Net premiums earned
ACE Global Markets	$	295		$	244		$	256		$	248		$	177		$	1,043		$	662
ACE International		712			638			604			566			494		$	2,520			1,731
Total	$	1,007		$	882		$	860		$	814		$	671		$	3,563		$	2,393
Net premiums written/gross premiums written
ACE Global Markets		64.2	%		72.1	%		69.9	%		74.0	%		55.2	%		69.6	%		54.2	%
ACE International		77.9	%		72.9	%		75.5	%		68.4	%		74.3	%		73.4	%		72.4	%
Total NPW/GPW		73.2	%		72.7	%		73.6	%		69.8	%		66.2	%		72.3	%		66.0	%
Loss ratio
ACE Global Markets		63.2	%		61.2	%		61.4	%		61.2	%		51.3	%		61.8	%		59.7	%
ACE International		58.4	%		59.4	%		59.8	%		60.4	%		56.9	%		59.5	%		61.2	%
Total loss ratio		59.8	%		59.9	%		60.3	%		60.7	%		55.5	%		60.2	%		60.8	%
Expense ratio
ACE Global Markets		33.1	%		35.7	%		35.7	%		36.7	%		52.1	%		35.3	%		49.6	%
ACE International		32.3	%		32.0	%		31.7	%		30.9	%		33.9	%		31.8	%		34.4	%
Total expense ratio		32.5	%		33.0	%		32.9	%		32.7	%		38.6	%		32.8	%		38.6	%
Combined ratio
ACE Global Markets		96.3	%		96.9	%		97.1	%		97.9	%		103.4	%		97.1	%		109.3	%
ACE International		90.7	%		91.4	%		91.5	%		91.3	%		90.8	%		91.3	%		95.6	%
Total combined ratio		92.3	%		92.9	%		93.2	%		93.4	%		94.1	%		93.0	%		99.4	%

Page 11

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

Global Reinsurance

	4Q-03			3Q-03			2Q-03			1Q-03			4Q-02			Full Year 2003			Full Year 2002
Property and casualty
Gross premiums written	$	225		$	276		$	349		$	462		$	113		$	1,312		$	887
Net premiums written		220			217			345			443			94			1,225			777
Net premiums earned		309			274			269			248			218			1,100			677
Losses and loss expenses		166			134			143			116			111			559			304
Policy acquisition costs		58			56			51			46			40			211			123
Administrative expenses		17			16			14			15			14			62			40
P&C underwriting income (loss)	$	68		$	68		$	61		$	71		$	53		$	268		$	210
Life
Gross premiums written	$	49		$	49		$	46		$	49		$	50		$	193		$	165
Net premiums written		47			47			44			47			47			185			159
Net premiums earned		48			46			42			48			46			184			158
Losses and loss expenses		44			45			44			48			52			181			158
Policy acquisition costs		5			5			2			4			1			16			16
Administrative expenses		1			—			1			1			1			3			6
Net investment income		8			10			8			7			8			33			27
Life underwriting income (loss)	$	6		$	6		$	3		$	2		$	—		$	17		$	5
Total underwriting income	$	74		$	74		$	64		$	73		$	53			285		$	215
Net investment income - property and casualty		24			23			21			19			19			87			82
Other income (expense)		1			1			—			1			—			3			1
Interest expense		—			—			—			—			—			—			1
Income tax expense (benefit)		4			3			3			4			—			14			1
Income (loss) excluding net realized gains (losses)	$	95		$	95		$	82		$	89		$	72		$	361		$	296
Net realized gains (losses)		8			10			13			3			—			34			(57	)
Tax effect of net realized gains (losses)		(1	)		—			1			—			—			—			—
Net income (loss)	$	102		$	105		$	96		$	92		$	72		$	395		$	239
P&C combined ratio
Loss and loss expense ratio		53.9	%		48.9	%		53.1	%		46.7	%		51.1	%		50.9	%		44.9	%
Policy acquisition cost ratio		18.9	%		20.4	%		18.8	%		18.6	%		18.2	%		19.2	%		18.1	%
Administrative expense ratio		5.5	%		5.7	%		5.3	%		6.0	%		6.5	%		5.6	%		5.9	%
P&C combined ratio		78.3	%		75.0	%		77.2	%		71.3	%		75.8	%		75.7	%		68.9	%
Large losses and other items
Large losses (before tax)	$	35		$	12		$	30		$	5		$	46		$	82		$	88

Page 12

ACE Limited Segment Results - Consecutive Quarters - 2 (in millions of U.S. dollars) (Unaudited)

Global Reinsurance - Property & Casualty

	4Q-03			3Q-03			2Q-03			1Q-03			4Q-02			Full Year 2003			Full Year 2002
% Change versus prior year period
Gross premiums written		99	%		48	%		63	%		24	%		242	%		48	%		93	%
Net premiums written		134	%		66	%		75	%		25	%		422	%		58	%		120	%
Net premiums earned		42	%		41	%		79	%		116	%		140	%		62	%		109	%
Other ratios
Net premiums written/gross premiums written		98	%		79	%		99	%		96	%		83	%		93	%		88	%
Global Reinsurance – By Division
Gross premiums written
Tempest Europe	$	63		$	60		$	97		$	123		$	34		$	343		$	230
Tempest USA		148			147			133			100			86			528			234
Tempest Bermuda		14			69			119			239			(7	)		441			423
Total GPW	$	225		$	276		$	349		$	462		$	113		$	1,312		$	887
Net premiums written
Tempest Europe	$	53		$	52		$	94		$	115		$	18		$	314		$	182
Tempest USA		148			144			132			99			86			523			234
Tempest Bermuda		19			21			119			229			(10	)		388			361
Total NPW	$	220		$	217		$	345		$	443		$	94		$	1,225		$	777
Net premiums earned
Tempest Europe	$	72		$	55		$	63		$	69		$	45		$	259		$	142
Tempest USA		138			127			112			86			69			463			182
Tempest Bermuda		99			92			94			93			104			378			353
Total NPE	$	309		$	274		$	269		$	248		$	218		$	1,100		$	677
Net premiums written/gross premiums written
Tempest Europe		84	%		87	%		97	%		93	%		53	%		92	%		79	%
Tempest USA		100	%		98	%		99	%		99	%		100	%		99	%		100	%
Tempest Bermuda		136	%		30	%		100	%		96	%		143	%		88	%		85	%
Total NPW/GPW		98	%		79	%		99	%		96	%		83	%		93	%		88	%

Page 13

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

Financial Services

	4Q-03			3Q-03			2Q-03			1Q-03			4Q-02			Full Year 2003			Full Year 2002
Gross premiums written	$	289		$	107		$	118		$	532		$	238		$	1,046		$	1,537
Net premiums written		276			105			132			526			228			1,039			1,497
Net premiums earned		472			205			215			209			292			1,101			1,127
Losses and loss expenses		428			144			161			161			257			894			947
Policy acquisition costs		16			17			17			11			14			61			72
Administrative expenses		24			22			20			18			15			84			57
Underwriting income (loss)	$	4		$	22		$	17		$	19		$	6		$	62		$	51
Net investment income		53			49			49			51			51			202			192
Other income		—			(1	)		1			—			1			—			1
Interest expense		1			2			1			2			2			6			12
Income tax expense		(1	)		11			8			9			6			27			30
Income (loss) excluding net realized gains (losses)	$	57		$	57		$	58		$	59		$	50		$	231		$	202
Net realized gains (losses)		69			29			72			(3	)		10			167			(117	)
Tax effect of net realized gains (losses)		(11	)		(6	)		(20	)		—			(10	)		(37	)		17
Net income (loss)	$	115		$	80		$	110		$	56		$	50		$	361		$	102
Combined ratio
Loss and loss expense ratio		90.6	%		70.2	%		74.9	%		77.0	%		88.2	%		81.2	%		84.0	%
Policy acquisition cost ratio		3.2	%		8.7	%		7.8	%		5.2	%		5.0	%		5.5	%		6.4	%
Administrative expense ratio		5.1	%		10.6	%		9.5	%		8.6	%		4.6	%		7.7	%		5.0	%
Combined ratio		98.9	%		89.5	%		92.2	%		90.8	%		97.8	%		94.4	%		95.4	%
Large losses and other items
Loss portfolio transfers(1)	$	270		$	4		$	—		$	—		$	99		$	274		$	311
% Change versus prior year period
Gross premiums written		21	%		-78	%		-63	%		9	%		-18	%		-32	%		4	%
Net premiums written		21	%		-78	%		-58	%		11	%		-43	%		-31	%		2	%
Net premiums earned		62	%		-45	%		-6	%		-11	%		-19	%		-2	%		-21	%
Other ratios
Net premiums written/gross premiums written		96	%		98	%		112	%		99	%		96	%		99	%		97	%

⁽¹⁾ Total premiums typically included in gross premiums written, net premiums written, and net premiums earned in the quarter it is written; usually accrued at 100% loss ratio.

Page 14

ACE Limited Segment Results - Consecutive Quarters - 2 (in millions of U.S. dollars) (Unaudited)

Financial Services

	4Q-03			3Q-03			2Q-03			1Q-03			4Q-02			Full Year 2003			Full Year 2002
Gross premiums written
Financial guaranty	$	158		$	112		$	119		$	121		$	97		$	510		$	391
Financial solutions		131			(5	)		(1	)		411			141			536			1,146
Total GPW	$	289		$	107		$	118		$	532		$	238		$	1,046		$	1,537
Net premiums written
Financial guaranty	$	159		$	111		$	119		$	120		$	96		$	509		$	387
Financial solutions		117			(6	)		13			406			132			530			1,110
Total NPW	$	276		$	105		$	132		$	526		$	228		$	1,039		$	1,497
Net premiums earned
Financial guaranty	$	88		$	80		$	82		$	78		$	81		$	328		$	282
Financial solutions		384			125			133			131			211			773			845
Total NPE	$	472		$	205		$	215		$	209		$	292		$	1,101		$	1,127
Loss ratio
Financial guaranty		71.3	%		46.4	%		49.7	%		50.1	%		73.0	%		54.8	%		58.4	%
Financial solutions		95.0	%		85.4	%		90.5	%		92.9	%		94.1	%		92.3	%		92.6	%
Total loss ratio		90.6	%		70.2	%		74.9	%		77.0	%		88.2	%		81.2	%		84.0	%
Expense ratio
Financial guaranty		38.0	%		33.7	%		35.3	%		27.6	%		17.8	%		33.9	%		24.6	%
Financial solutions		1.5	%		10.1	%		6.1	%		5.7	%		6.4	%		4.4	%		7.0	%
Total expense ratio		8.3	%		19.3	%		17.3	%		13.8	%		9.6	%		13.2	%		11.4	%
Combined ratio
Financial guaranty		109.3	%		80.1	%		85.0	%		77.7	%		90.8	%		88.7	%		83.0	%
Financial solutions		96.5	%		95.5	%		96.6	%		98.6	%		100.5	%		96.7	%		99.6	%
Total combined ratio		98.9	%		89.5	%		92.2	%		90.8	%		97.8	%		94.4	%		95.4	%

Page 15

ACE Limited Financial Guaranty Profile (in millions of U.S. dollars) (Unaudited)

	Gross Par Written (7)								Net Par Outstanding/Average Ratings
	Three months ended				Year ended				Year ended					Year ended
	December 31, 2003								December 31, 2003					December 31, 2002
Sector	Par Outstanding		% of total		Par Outstanding		% of total		Par Outstanding		% of total		Average Rating	Par Outstanding		% of total		Average Rating
Municipal Exposure
Tax Backed	$	1,045	25	%	$	2,656	16	%	$	21,090	24	%	A+	$	19,637	24	%	A+
Municipal Utilities		447	11	%		1,680	10	%		11,114	13	%	A+		10,390	13	%	A+
Special Revenue		215	5	%		1,292	8	%		9,060	10	%	A		8,596	10	%	A
Healthcare		153	4	%		581	3	%		5,828	6	%	A+		5,798	7	%	A
Structured Municipal (1)		—	0	%		—	0	%		3,378	4	%	AAA		3,523	4	%	AAA
Other Municipal (2)		84	2	%		559	3	%		2,378	3	%	A-		2,151	3	%	A-
Total Municipal	$	1,944	47	%	$	6,768	40	%	$	52,848	60	%	A+	$	50,095	61	%	A
Non-Municipal Exposure
Senior Layer CDO’s (3)	$	345	8	%	$	4,117	24	%	$	16,601	19	%	AA+	$	12,727	16	%	AA+
Consumer Receivables (4)		1,217	29	%		3,437	20	%		9,461	11	%	A		8,388	10	%	A
Single Name Corporate CDS		—	0	%		150	1	%		2,305	2	%	A+		4,454	5	%	A+
Commercial Receivables (5)		524	13	%		2,013	12	%		5,322	6	%	A+		3,464	4	%	A+
Other Structured Finance (6)		140	3	%		594	3	%		1,920	2	%	A+		2,051	3	%	A
Funded Equity CDO’s (3)		—	0	%		8	0	%		407	0	%	NM		586	1	%	NM
Total Non-Municipal	$	2,226	53	%	$	10,319	60	%	$	36,016	40	%	AA-	$	31,670	39	%	AA-
Total Exposure	$	4,170	100	%	$	17,087	100	%	$	88,864	100	%		$	81,765	100	%

⁽¹⁾ Structured Municipal: includes excess of loss reinsurance on portfolios of municipal credits where the company attached in excess of the AAA rating level.

⁽²⁾ Other Municipal: primarily includes first mortgage bonds on investor-owned utilities and government-sponsored project finance.

⁽³⁾ For ACE, collateralized debt obligations (CDO’s) are structured financings backed by a pool of investment grade assets. These financings are typically structured in multiple tranches (layers) from equity (first loss) through super senior (high excess). Losses on defaulted pool assets are allocated successively first to the equity tranche then to higher rated tranches. Market supply and demand factors influence pricing and the amount and position in the structure where ACE chooses to participate.

⁽⁴⁾ Consumer Receivables: principally includes auto loan receivables, residential mortgage-backed securities and credit card receivables.

⁽⁵⁾ Commercial Receivables: principally includes equipment leases and commercial mortgage-backed securities.

⁽⁶⁾ Other Structured Finance: predominantly trade receivable securitization, secured structured lending, and future flow transactions.

⁽⁷⁾ Gross par approximates net par as the company is a net line writer.

Note - Ratings are internally determined based on rating agency guidelines

Page 16

ACE Limited Financial Guaranty Profile - 2 (in millions of U.S. dollars) (Unaudited)

Distribution by Ratings of Financial Guaranty Portfolio

	At December 31, 2003
	Net Par Outstanding		% of total
AAA	$	26,344	30	%
AA		17,804	20	%
A		30,294	34	%
BBB		12,555	14	%
Below investment grade		1,460	2	%
Funded equity		407	0	%
Total	$	88,864	100	%
Geographic Distribution of Financial Guaranty Portfolio as of December 31, 2003
	Net Par Outstanding		% of total
Domestic
California	$	7,260	8.2	%
New York		5,556	6.3	%
Texas		3,229	3.6	%
Illinois		2,801	3.1	%
Florida		2,783	3.1	%
Pennsylvania		2,170	2.4	%
New Jersey		1,993	2.2	%
Massachusetts		1,724	1.9	%
Puerto Rico		1,507	1.7	%
Washington		1,312	1.5	%
Other - Muni		18,434	20.7	%
Other - Non Muni		33,240	37.4	%
Total Domestic	$	82,009	92.3	%
International
United Kingdom	$	3,341	3.8	%
Australia		384	0.4	%
Italy		367	0.4	%
France		361	0.4	%
Brazil		300	0.3	%
Other		2,102	2.4	%
Total International	$	6,855	7.7	%
Net Par Outstanding	$	88,864	100	%

Page 17

ACE Limited Financial Services Portfolio 25 Largest Municipal Exposures (in millions of U.S. dollars) (Unaudited)

Obligor Name	Net Par In Force (1)		Rating
Long Island Power Authority	$	721	A-
California State General Obligation & Leases		666	BBB
Denver Colorado Airport System		632	A
Chicago Illinois General Obligation		589	A+
Jefferson County Alabama Sewer		567	A
New York City General Obligation		543	A
Puerto Rico Electric Power Authority		537	A-
New York State Metro Trans Auth - Trans Revenue		535	A
New York City Municipal Water Finance Authority		531	AA
San Francisco California Airport		505	A
Massachusetts State GO & Bay Transportation & Leases		479	AA-
New Jersey State General Obligation & Leases		465	AA-
Energy Northwest (FKA WPPSS)		396	AA-
Dade County Florida Water & Sewer System		366	A
Los Angeles County Metro Trans - Sales Tax - 1st		361	AA
Houston Texas Water & Sewer System		328	A+
Intermountain Power Agency		320	A+
Illinois State General Obligation & Leases		313	AA
Municipal Electric Authority of Georgia - Senior		302	A
New Jersey State Turnpike		298	A
Puerto Rico General Obligation & Leases		290	A-
Mental Health Services Facilities - New York		285	AA-
District of Columbia General Obligation		278	A-
Chicago Illinois Public Building - Board of Education		272	A+
Puerto Rico Government Development Bank		267	AAA

⁽¹⁾ Excludes Net Par In Force for transactions insured by an AAA monoline financial guaranty company

Page 18

ACE Limited Financial Services Portfolio - 2 25 Largest Asset-Backed Exposures (Non - Municipal) (in millions of U.S. dollars) (Unaudited)

Obligor Name	Net Par In Force		Rating
SALS 2002-6 - Synthetic CDO	$	740	AAA
Triplas CDO OF ABS		625	AAA
Absolute CDO OF ABS		594	AAA
Taurus 2001-06 - Synthetic CDO		554	A+
Sears Credit Card Master Trust 2002-3 Class A - Credit Cards		550	AAA
Dresdner 2001 - 1 - Synthetic CDO		500	AAA
Houston CDO Portfolio 2000-1		470	AA
Bistro 2001-09 - AAA Tranche - Synthetic CDO		450	AAA
Stars 2001-3 - Synthetic CDO		440	AAA
Merrill Lynch Synthetic CDO Taurus 8		440	AAA
Merrill Lynch Dots 4 - Synthetic CDO		430	AAA
SALS 2003-9 - Synthetic CDO		410	AAA
Lehman Sprint 2001-1 Super Senior - Synthetic CDO		376	AAA
Magrathea V - Synthetic CDO		360	AAA
Taurus 2001-01 - Synthetic CDO		347	AAA
ING Equity Trust (Pilgrim Principal Protection)		308	AAA
Bistro 2000-07 Class A-1 - Synthetic CDO		300	AAA
Europa II Limited Class A1 - Synthetic CDO		292	AAA
Hights 2001-1 - Synthetic CDO		286	AAA
CDO ^2 - CDO of CDOs		281	AAA
Metris Master Credit Card Trust		279	BB
Halcyon Synthetic CDO		278	AAA
Morgan Stanley Dean Witter 2003-NC9 Class A1		276	AAA
Wuertthyp F-1 - CMBS		268	AAA
EMMOCA IV Portfolio - Synthetic CDO		250	AA+

Page 19

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

Largest Single Name Corporate CDS

Obligor Name	Net Par In Force (1)		Rating
General Electric Company	$	110	AAA
General Motors Corporation		55	BBB
ABN AMRO Bank NV		53	AA-
Fortis NV		51	A+
Japan Republic Sovereign Obligation		50	AA-
American International Group, Inc. (AIG)		50	AAA
Allianz AG		50	AA-
FNMA - Fannie Mae		45	AAA
Deutsche Telekom AG		40	BBB+
France Telecom		40	A+

Rating	Gross Par Written (2)				Net Par Outstanding
	Three months ended		Year ended
	December 31, 2003
AAA	$	—	$	30	$	474
AA		—		40		386
A		—		60		1,096
BBB		—		20		339
Below investment grade		—		—		10
Total	$	—	$	150	$	2,305

⁽¹⁾ Excludes Net Par In Force for transactions insured by an AAA monoline financial guaranty company

⁽²⁾ Gross par approximates net par as the company is a net line writer

Page 20

ACE Limited Financial Services Portfolio - 4 (in millions of U.S. dollars) (Unaudited)

Maturity Profile of Select Par Insured Categories

(Outstanding Net Par)

	2004(1)		2005		2006		2007		2008
Senior Layer CDO’s
Beginning outstanding par	$	16,601	$	16,271	$	14,215	$	11,528	$	8,191
Scheduled runoff amount		330		2,056		2,687		3,337		1,892
Ending outstanding par	$	16,271	$	14,215	$	11,528	$	8,191	$	6,299
Single Name Corporate CDS
Beginning outstanding par	$	2,305	$	1,647	$	666	$	465	$	178
Scheduled runoff amount		658		981		201		287		44
Ending outstanding par	$	1,647	$	666	$	465	$	178	$	134
Funded Equity CDO’s
Beginning outstanding par	$	407	$	407	$	407	$	381	$	160
Scheduled runoff amount		—		—		26		221		—
Ending outstanding par	$	407	$	407	$	381	$	160	$	160

⁽¹⁾ Beginning balance as of January 1, 2004

	Gross Par Written (2)				Net Par Outstanding
CDO’s	Three months ended		Year ended
Rating	December 31, 2003
AAA	$	340	$	4,090	$	12,884
AA		—		6		1,834
A		5		16		1,031
BBB		—		5		759
Below investment grade		—		—		93
Funded Equity		—		8		407
Total	$	345	$	4,125	$	17,008

⁽²⁾ Gross par approximates net par as the company is a net line writer

Page 21

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, 2001	$	20,728		$	10,629		$	10,099		$	13,492		$	5,872		$	7,620		$	7,236		$	4,757		$	2,479
Losses and loss expenses incurred		1,599			746			853			1,465			623			842			134			123			11
Losses and loss expenses paid		(1,792	)		(816	)		(976	)		(1,501	)		(686	)		(815	)		(291	)		(130	)		(161	)
Other (incl. foreign exch. revaluation)		(20	)		26			(46	)		(20	)		26			(46	)		—			—			—
Balance at March 31, 2002	$	20,515		$	10,585		$	9,930		$	13,436		$	5,835		$	7,601		$	7,079		$	4,750		$	2,329
Losses and loss expenses incurred		1,806			845			961			1,668			717			951			138			128			10
Losses and loss expenses paid		(1,739	)		(699	)		(1,040	)		(1,434	)		(574	)		(860	)		(305	)		(125	)		(180	)
Other (incl. foreign exch. revaluation)		79			26			53			79			26			53			—			—			—
Balance at June 30, 2002	$	20,661		$	10,757		$	9,904		$	13,749		$	6,004		$	7,745		$	6,912		$	4,753		$	2,159
Losses and loss expenses incurred		2,177			849			1,328			2,166			843			1,323			11			6			5
Losses and loss expenses paid		(1,348	)		(586	)		(762	)		(1,173	)		(558	)		(615	)		(175	)		(28	)		(147	)
Other (incl. foreign exch. revaluation)		151			11			140			151			11			140			—			—			—
Balance at September 30, 2002	$	21,641		$	11,031		$	10,610		$	14,893		$	6,300		$	8,593		$	6,748		$	4,731		$	2,017
Losses and loss expenses incurred		4,530			2,766			1,764			2,400			1,115			1,285			2,130			1,651			479
Losses and loss expenses paid		(2,023	)		(851	)		(1,172	)		(1,628	)		(668	)		(960	)		(395	)		(183	)		(212	)
Other (incl. foreign exch. revaluation)		167			51			116			167			51			116			—			—			—
Balance at December 31, 2002	$	24,315		$	12,997		$	11,318		$	15,832		$	6,798		$	9,034		$	8,483		$	6,199		$	2,284
Losses and loss expenses incurred		2,390			1,107			1,283			2,365			1,104			1,261			25			3			22
Losses and loss expenses paid		(2,155	)		(984	)		(1,171	)		(1,910	)		(893	)		(1,017	)		(245	)		(91	)		(154	)
Other (incl. foreign exch. revaluation)		86			16			70			79			16			63			7			—			7
Balance at March 31, 2003	$	24,636		$	13,136		$	11,500		$	16,366		$	7,025		$	9,341		$	8,270		$	6,111		$	2,159
Losses and loss expenses incurred		2,511			1,052			1,459			2,463			1,020			1,443			48			32			16
Losses and loss expenses paid		(2,415	)		(1,357	)		(1,058	)		(1,964	)		(1,134	)		(830	)		(451	)		(223	)		(228	)
Other (incl. foreign exch. revaluation)		208			123			85			208			123			85			—			—			—
Balance at June 30, 2003	$	24,940		$	12,954		$	11,986		$	17,073		$	7,034		$	10,039		$	7,867		$	5,920		$	1,947
Losses and loss expenses incurred		2,552			1,033			1,519			2,472			977			1,495			80			56			24
Losses and loss expenses paid		(1,833	)		(863	)		(970	)		(1,557	)		(663	)		(894	)		(276	)		(200	)		(76	)
Other (incl. foreign exch. revaluation)		(22	)		(19	)		(3	)		(12	)		(19	)		7			(10	)		—			(10	)
Balance at September 30, 2003	$	25,637		$	13,105		$	12,532		$	17,976		$	7,329		$	10,647		$	7,661		$	5,776		$	1,885
Losses and loss expenses incurred		2,812			956			1,856			2,779			932			1,847			33			24			9
Losses and loss expenses paid		(1,810	)		(1,104	)		(706	)		(1,433	)		(797	)		(636	)		(377	)		(307	)		(70	)
Other (incl. foreign exch. revaluation) (2)		516			235			281			513			235			278			3			—			3
Balance at December 31, 2003	$	27,155		$	13,192		$	13,963		$	19,835		$	7,699		$	12,136		$	7,320		$	5,493		$	1,827

⁽¹⁾ The run-off reserves primarily include Brandywine group, the Commercial Insurance Service - Middle Market Worker's Comp. reserves and the pre-1997 Westchester Specialty reserves. Prior year split between gross and ceded reserves and loss activity in ongoing and run-off categories has been revised to properly reflect intercompany reinsurance eliminations.

⁽²⁾ Other includes approximately $220 million of gross losses and $140 million of reinsurance recoverable related to ACE increasing its participation in the Lloyds syndicate to 100%.

Page 22

ACE Limited Asbestos and Environmental Reserves (in millions of U.S. dollars) (Unaudited)

	Asbestos									Asbestos - December 31, 2003*
	Gross			Ceded			Net			Gross 3 year survival ratio	Gross 1 year survival ratio
Balance at December 31, 2002	$	3,192		$	2,746		$	446		10.3x	9.9x
Prior period development		—			—			—
Losses and loss expenses paid		(44	)		(18	)		(26	)
Balance at March 31, 2003	$	3,148		$	2,728		$	420
Prior period development		—			—			—
Losses and loss expenses paid		(65	)		(26	)		(39	)
Balance at June 30, 2003	$	3,083		$	2,702		$	381
Prior period development		—			—			—
Losses and loss expenses paid		(56	)		(31	)		(25	)
Balance at September 30, 2003	$	3,027		$	2,671		$	356
Prior period development		—						—
Losses and loss expenses paid		(128	)		(49	)		(79	)
Balance at December 31, 2003	$	2,899		$	2,622		$	277
	Environmental & Other Latent Exposures
	Gross			Ceded			Net
Balance at December 31, 2002	$	1,352		$	949		$	403
Prior period development		—			—			—
Losses and loss expenses paid		(45	)		(8	)		(37	)
Balance at March 31, 2003	$	1,307		$	941		$	366
Prior period development		—			—			—
Losses and loss expenses paid		(75	)		(24	)		(51	)
Balance at June 30, 2003	$	1,232		$	917		$	315
Prior period development		—			—			—
Losses and loss expenses paid		(36	)		(18	)		(18	)
Balance at September 30, 2003	$	1,196		$	899		$	297
Prior period development		—						—
Losses and loss expenses paid		(48	)		(1	)		(47	)
Balance at December 31, 2003	$	1,148		$	898		$	250

* The survival ratios are adversely affected by the timing of certain previously agreed upon settlements. These payments were anticipated in our 2002 asbestos study.

Page 23

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

Net Reinsurance Recoverable by Division

	December 31 2003			September 30 2003			June 30 2003			March 31 2003			December 31 2002
Reinsurance recoverable on paid losses & loss expenses
Active operations	$	835		$	863		$	869		$	950		$	951
Brandywine(1)		419			410			417			397			385
Westchester(2)		23			24			17			25			27
Total	$	1,277		$	1,297		$	1,303		$	1,372		$	1,363
Reinsurance recoverable on unpaid losses & loss expenses
Active operations	$	8,494		$	8,299		$	7,965		$	7,997		$	7,839
Brandywine(1)		4,729			4,873			5,044			5,218			5,237
Westchester(2)		541			498			505			496			491
Total	$	13,764		$	13,670		$	13,514		$	13,711		$	13,567
Gross reinsurance recoverable
Active operations	$	9,329		$	9,162		$	8,834		$	8,947		$	8,790
Brandywine(1)		5,148			5,283			5,461			5,615			5,622
Westchester(2)		564			522			522			521			518
Total	$	15,041		$	14,967		$	14,817		$	15,083		$	14,930
Bad debt reserve
Active operations	$	(482	)	$	(443	)	$	(434	)	$	(449	)	$	(431	)
Brandywine(1)		(449	)		(463	)		(463	)		(473	)		(478	)
Westchester(2)		(29	)		(29	)		(29	)		(29	)		(30	)
Total	$	(960	)	$	(935	)	$	(926	)	$	(951	)	$	(939	)
Net reinsurance recoverable
Active operations	$	8,847		$	8,719		$	8,400		$	8,498		$	8,359
Brandywine(1)		4,699			4,820			4,998			5,142			5,144
Westchester(2)		535			493			493			492			488
Total	$	14,081		$	14,032		$	13,891		$	14,132		$	13,991

⁽¹⁾ The Company’s obligations with respect to further funding of the Brandywine run-off are limited pursuant to the Brandywine Restructuring Order under an $800 million aggregate excess of loss reinsurance agreement. (Refer to the "Asbestos and Environmental Claims" section of the "Management's Discussion and Analysis of Financial Conditions and Results of Operations" incorporated into our filed Form 10-K for the year ended December 31, 2002 for additional information about the order and other Company obligations.) As at December 31, 2003, approximately $466 million in losses and recoverable bad debt reserves were ceded to the aggregate excess of loss reinsurance agreement leaving a remaining limit of approximately $334 million.

⁽²⁾ As part of the Westchester acquisition, National Indemnity provided reinsurance protection for all losses occurring prior to 1997. At December 31, 2003, the remaining unimpaired limit in the reinsurance cover was approximately $600 million.

Note: Active operations include the run-off operations of CIS and certain other divisions.

Page 24

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

Reinsurance Recoverable for Active Operations

	September 30, 2003
Categories	Recoverable		Bad Debt		% of Gross
Top 10 reinsurers	$	4,149	$	53	1.3	%
Other reinsurers balances >$20 million		2,365		84	3.6	%
Other reinsurers balances <$20 million		673		130	19.3	%
Mandatory pools and government agencies		742		4	0.5	%
Structured settlements		274		1	0.4	%
Captives		710		2	0.3	%
Other		249		169	67.8	%
Total	$	9,162	$	443	4.8	%

At September 30, 2003, $6.7 billion of the active operations' recoverables were from rated reinsurers, of which 84% were rated the equivalent of A- or better by nationally recognized rating agencies. The Company held collateral of $2.3 billion, of which $1.5 billion was matched and usable against existing recoverables.

Top 10 Reinsurers (net of collateral)	Other Reinsurers Balances Greater Than $20 million (net of collateral)
American International Group	ABB Group	Hartford Insurance Group
AXA	AIOI Insurance	Independence Blue Cross (Amerihealth)
Berkshire Hathaway Insurance Group	Allianz Group	ING - Internationale Nederlanden Group
Electric Insurance Company	American National Insurance Company	IRB- Brasil Resseguros S.A.
GE Global Insurance Group (Employers Re)	American United Life Insurance	Liberty Mutual Insurance Companies
Hannover	Arch Capital	Overseas Partners Ltd.
Lloyd’s of London	AVIVA	PMA Capital Insurance Company
Munich Re	Chubb Insurance Group	QBE Insurance
St. Paul Companies	CIGNA	RenaissanceRe Holdings Ltd
Swiss Re Group	CNA Insurance Companies	Royal & Sun Alliance Insurance Group plc
	Converium Group	SCOR Group
	DaimlerChrysler Group	Sompo Japan
	Dorinco Reinsurance Co.	Toa Reinsurance Company
	EQUITAS	Trenwick Group
	Everest Re Group	White Mountains Insurance Group
	Fairfax Financial	WR Berkley Corp
	FM Global Group	XL Capital Group
	Gerling Group	Zurich Financial Services Group
	Groupama

Page 25

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

Consolidated Reinsurance Recoverable

	September 30, 2003
Categories	Recoverable		Bad Debt		% of Gross
Top 10 reinsurers	$	7,910	$	82	1.0	%
Other reinsurers balances >$20 million		3,143		137	4.4	%
Other reinsurers balances <$20 million		892		165	18.5	%
Mandatory pools and government agencies		772		4	0.5	%
Structured settlements		651		3	0.5	%
Captives		755		2	0.3	%
Other		844		542	64.2	%
Total	$	14,967	$	935	6.2	%

At September 30, 2003, $11.3 billion of consolidated recoverables were from rated reinsurers, of which 88% were rated the equivalent of A- or better by nationally recognized rating agencies.

Top 10 Reinsurers (net of collateral)	Other Reinsurers Balances Greater Than $20 million (net of collateral)
American International Group	ABB Group	Groupama
AXA	AIOI Insurance	Hartford Insurance Group
Berkshire Hathaway Insurance Group	Allianz Group	Independence Blue Cross (Amerihealth)
EQUITAS	Arch Capital	ING - Internationale Nederlanden Group
GE Global Insurance Group	American National Insurance Company	IRB - Brasil Resseguros S.A.
Hannover	American United Life Insurance	Liberty Mutual Insurance Companies
Lloyd’s of London	AVIVA	Overseas Partners Ltd.
Munich Re	Chubb Insurance Group	PMA Capital Insurance Company
St. Paul Companies	CIGNA	QBE Insurance
Swiss Re Group	CNA Insurance Companies	RenaissanceRe Holdings Ltd
	Converium Group	Royal & Sun Alliance Insurance Group plc
	DaimlerChrysler Group	SCOR Group
	Dominion Ins. Co. Ltd.	Sompo Japan
	Dorinco Reinsurance Co.	Toa Reinsurance Company
	Electric Insurance Company	Travelers Property Casualty Group
	Everest Re Group	Trenwick Group
	Fairfax Financial	White Mountains Insurance Group
	FM Global Group	WR Berkley Corp
	Gerling Group	XL Capital Group
	Great American P&C Insurance Companies	Zurich Financial Services Group

Page 26

ACE Limited Reinsurance Recoverable Analysis - 4 (in millions of U.S. dollars) (Unaudited)

Detail on Reinsurance Recoverable on Paid Losses and Loss Expenses

	General Collections (1)			Other (2)			Total
Gross balance at December 31, 2002	$	848		$	515		$	1,363
Bad debt reserve at 12/31/02		43			335			378
% of gross		5.1	%		65.0	%		27.7	%
Net balance at December 31, 2002		805			180			985
Gross balance at March 31, 2003	$	848		$	524		$	1,372
Bad debt reserve at 3/31/03		54			333			387
% of gross		6.4	%		63.5	%		28.2	%
Net balance at March 31, 2003		794			191			985
Gross balance at June 30, 2003	$	795		$	508		$	1,303
Bad debt reserve at 6/30/03		51			327			378
% of gross		6.4	%		64.4	%		29.0	%
Net balance at June 30, 2003		744			181			925
Gross balance at September 30, 2003	$	765		$	532		$	1,297
Bad debt reserve at 9/30/03		46			339			385
% of gross		6.0	%		63.7	%		29.7	%
Net balance at September 30, 2003		719			93			912
Gross balance at December 31, 2003	$	730		$	547		$	1,277
Bad debt reserve at 12/31/03		45			358			403
% of gross		6.2	%		65.4	%		31.6	%
Net balance at December 31, 2003	$	685		$	189		$	874

⁽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. Our estimation of this reserve considers the credit quality of the reinsurer, and whether we have received collateral or other credit protections such as parental guarantees.

Page 27

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

	December 31 2003			September 30 2003			June 30 2003			March 31 2003			December 31 2002
Market Value
Fixed maturities	$	18,645		$	17,413		$	16,884		$	15,044		$	14,420
Securities on loan		684			596			546			521			293
Short-term investments		2,928			2,931			2,840			2,101			2,270
Cash		562			431			576			477			663
Total	$	22,819		$	21,371		$	20,846		$	18,143		$	17,646
Asset Allocation by Market Value
Treasury	$	1,715		$	1,010		$	886		$	859		$	842
Agency		1,512			1,170			1,383			1,074			973
Corporate		8,118			7,718			7,796			7,117			6,459
Mortgage-backed securities		3,894			4,235			3,825			3,415			3,302
Asset-backed securities		737			519			439			338			352
Municipal		1,445			1,329			1,346			1,220			1,201
Non-US		1,909			2,028			1,755			1,542			1,584
Cash & cash equivalent		3,489			3,362			3,416			2,578			2,933
Total	$	22,819		$	21,371		$	20,846		$	18,143		$	17,646
Credit Quality by Market Value
AAA	$	12,315		$	10,931		$	10,633		$	8,808		$	8,889
AA		3,389			3,517			3,623			3,285			2,942
A		3,534			3,366			3,162			3,027			2,920
BBB		1,783			1,742			1,592			1,464			1,314
BB		709			764			782			697			662
B		1,029			973			939			791			843
Other		60			78			115			71			76
Total	$	22,819		$	21,371		$	20,846		$	18,143		$	17,646
Cost/Amortized Cost
Fixed maturities	$	18,006		$	16,713		$	15,974		$	14,370		$	13,791
Securities on loan		650			549			498			494			286
Short term investments		2,928			2,931			2,840			2,101			2,270
Cash		562			431			576			477			663
Subtotal		22,146			20,624			19,888			17,442			17,010
Equity securities		401			371			400			414			442
Other investments		602			625			626			657			622
Total	$	23,149		$	21,620		$	20,914		$	18,513		$	18,074
Avg. duration of fixed maturities, adj. for int. rate swaps		3.4 years			3.4 years			3.2 years			3.1 years			3.1 years
Avg. market yield of fixed maturities		4.0	%		4.0	%		3.8	%		4.2	%		4.4	%
Avg. credit quality		AA			AA			AA			AA			AA

Page 28

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

Investment portfolio

Top 10 Exposures - Fixed Maturity Investments and Single Name Credit Default Swaps

December 31, 2003		September 30, 2003		June 30, 2003
General Electric	$303	General Electric	$293	General Electric	$289
Citigroup Inc	186	General Motors	192	General Motors	199
General Motors	167	Citigroup Inc	189	Citigroup Inc	173
HSBC Holdings Plc	144	Verizon Communications	123	Verizon Communications	141
Verizon Communications	119	AIG	117	HSBC Holdings Plc	119
AIG	108	HSBC Holdings Plc	110	AIG	118
DaimlerChrysler	101	Ford Motor Co	104	Merrill Lynch	116
Morgan Stanley	95	Goldman Sachs Group	97	Goldman Sachs Group	103
Ford Motor Co	94	Morgan Stanley	95	Morgan Stanley	102
Deutsche Telekom	84	Merrill Lynch	86	Ford Motor Co	101
March 31, 2003		December 31, 2002
General Electric	$287	General Electric	$258
General Motors	170	General Motors	171
Citigroup Inc	168	Citigroup Inc	154
Verizon Communications	143	Verizon Communications	127
AIG	118	AIG	123
Ford Motor Co	113	Ford Motor Co	123
Merrill Lynch	110	Bank of America	119
Morgan Stanley	108	Wachovia Corp	106
Goldman Sachs Group	101	Wells Fargo	105
HSBC Holdings Plc	100	JP Morgan Chase	105

Page 29

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

	Three months ended December 31, 2003									Year ended December 31, 2003
	Net Realized Gains (Losses) (1)			Net Unrealized Gains (Losses)			Net Impact			Net Realized Gains (Losses) (1)			Net Unrealized Gains (Losses)			Net Impact
Investment Portfolio Gains (Losses)
Fixed maturities	$	23		$	(68	)	$	(45	)	$	100		$	22		$	122
Interest rate swaps		3			—			3			(6	)		—			(6	)
Equity securities		12			49			61			(41	)		189			148
Equity and fixed income derivatives		12			—			12			40			—			40
Foreign exchange gains (losses)		3			—			3			21			—			21
Other		(12	)		3			(9	)		(25	)		12			(13	)
Total inv. portfolio gains (losses)	$	41		$	(16	)	$	25		$	89		$	223		$	312
Credit derivatives (FAS 133 adjustment)		64			—			64			140			—			140
Total gains (losses)	$	105		$	(16	)	$	89		$	229		$	223		$	452
Income tax (expense) benefit		(12	)		13			1			(32	)		(15	)		(47	)
Net gains (losses)	$	93		$	(3	)	$	90		$	197		$	208		$	405

⁽¹⁾ The quarter includes impairments of $4M for fixed maturities, $2M for equities and $9M for other. Year to date includes impairments of $29M for fixed maturities, $63M for equities and $29M for other.

	Three months ended December 31, 2002									Year ended December 31, 2002
	Net Realized Gains (Losses) (2)			Net Unrealized Gains (Losses)			Net Impact			Net Realized Gains (Losses) (2)			Net Unrealized Gains (Losses)			Net Impact
Investment Portfolio Gains (Losses)
Fixed maturities	$	(4	)	$	60		$	56		$	(58	)	$	437		$	379
Interest rate swaps		(2	)		—			(2	)		(81	)		—			(81	)
Equity securities		(102	)		121			19			(157	)		10			(147	)
Equity and fixed income derivatives		11			—			11			(107	)		—			(107	)
Foreign exchange gains (losses)		4			—			4			3			—			3
Other		(15	)		5			(10	)		(12	)		8			(4	)
Total inv. portfolio gains (losses)	$	(108	)	$	186		$	78		$	(412	)	$	455		$	43
Credit derivatives (FAS 133 adjustment)		20			—			20			(77	)		—			(77	)
Total gains (losses)	$	(88	)	$	186		$	98		$	(489	)	$	455		$	(34	)
Income tax (expense) benefit		19			(29	)		(10	)		72			(116	)		(44	)
Net gains (losses)	$	(69	)	$	157		$	88		$	(417	)	$	339		$	(78	)

⁽²⁾ The quarter includes impairments of $25M for fixed maturities, $99M for equities and $14M for other. Year to date includes impairments of $101M for fixed maturities, $153M for equities and $14M for other.

Page 30

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

	December 31 2003			September 30 2003			June 30 2003			March 31 2003			December 31 2002			December 31 2001
Total short-term debt	$	146		$	146		$	146		$	146		$	146		$	495
Total long-term debt (1)		1,749			1,749			1,749			1,749			1,749			1,349
Total debt	$	1,895		$	1,895		$	1,895		$	1,895		$	1,895		$	1,844
Total trust preferreds (2)	$	475		$	475		$	475		$	475		$	475		$	875
Mezzanine equity (3)	$	—		$	—		$	—		$	311		$	311		$	311
Perpetual preferred (4)	$	557		$	557		$	557		$	—		$	—		$	—
Ordinary shareholders’ equity		8,255			7,789			7,621			6,702			6,389			6,107
Total shareholders’ equity	$	8,812		$	8,346		$	8,178		$	6,702		$	6,389		$	6,107
Total capitalization	$	11,182		$	10,716		$	10,548		$	9,383		$	9,070		$	9,137
Tangible shareholders’ equity (5)	$	6,101		$	5,635		$	5,467		$	3,991		$	3,672		$	3,335
Leverage ratios
Debt/ total capitalization		16.9	%		17.7	%		18.0	%		20.2	%		20.9	%		20.2	%
Debt plus trust preferreds/ total capitalization		21.2	%		22.1	%		22.5	%		25.3	%		26.1	%		29.8	%
Debt/ tangible equity		31.1	%		33.6	%		34.7	%		47.5	%		51.6	%		55.3	%
Debt plus trust preferreds and mezzanine equity/ tangible equity		38.8	%		42.1	%		43.4	%		67.2	%		73.0	%		90.9	%
Debt plus total preferred stock/ total capitalization		26.2	%		27.3	%		27.7	%		25.3	%		26.1	%		29.8	%

⁽¹⁾ $50 million of ACE INA subordinated notes due 2009 was repaid in both the second and third quarters of 2002. An additional $500 million of Senior Debt was issued by ACE Limited in March 2002.

⁽²⁾ $400 million of ACE INA Rhino Preferred Securities due 2002 was repaid in the second and third quarters of 2002.

⁽³⁾ The FELINE PRIDES converted in the second quarter of 2003.

⁽⁴⁾ Preferred shares $575 million, net of issuance costs $18 million.

⁽⁵⁾ Tangible equity is equal to shareholders’ equity less goodwill.

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ACE Limited Non-GAAP Financial Measures and Comprehensive Income (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 to diluted book value per ordinary share is provided on page 33. The following non-GAAP measure is a common performance measurement and is defined as net income (loss) excluding net realized gains (losses) on investments and the tax effect of net realized gains (losses) on investments. 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) on investments because the amount of these gains (losses) is heavily influenced by, and fluctuates in part, according to the availability of market opportunities. We believe these amounts are largely independent of our business and including them would distort the analysis of trends. 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).

	4Q-03			3Q-03			2Q-03			1Q-03			4Q-02			Full Year 2003			Full Year 2002
Net income (loss), as reported	$	421		$	355		$	371		$	247		$	(168	)	$	1,394		$	77
Net realized gains (losses)		105			57			107			(40	)		(88	)		229			(489	)
Tax effect of net realized gains (losses)		(12	)		(6	)		(22	)		8			19			(32	)		72
Income (loss) excluding net realized gains (losses)	$	328		$	304		$	286		$	279		$	(99	)	$	1,197		$	494

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

Reconciliation of Book Value per Ordinary Share to Diluted Book Value per Ordinary Share

	December 31			September 30			June 30			March 30		December 31
	2003			2003			2003			2003		2002
Shareholders’ equity	$	8,812		$	8,346		$	8,178		$	6,702	$	6,389
Net proceeds from assumed conversions of options		390			277			291			226		138
Proceeds from issuance of preferred shares		(557	)		(557	)		(557	)		—		—
Conversion of mezzanine equity		—			—			—			311		311
Numerator for diluted book value per share calculation		8,645			8,066			7,912			7,239		6,838
Less: goodwill		2,711			2,711			2,711			2,711		2,717
Numerator for diluted tangible book value per share	$	5,934		$	5,355		$	5,201		$	4,528	$	4,121
Ordinary shares outstanding – end of period		279,897,193			278,480,910			277,755,290			264,491,819		262,679,356
Shares issued from assumed conversions of options		14,305,419			12,028,816			12,669,243			11,697,607		8,560,131
Shares issued on conversion of mezzanine equity		—			—			—			11,814,373		11,814,373
Denominator for diluted and diluted tangible book value		294,202,612			290,509,726			290,424,533			288,003,799		283,053,860
Book value per ordinary share	$	29.49		$	27.97		$	27.44		$	25.34	$	24.32
Diluted book value per ordinary share	$	29.38		$	27.76		$	27.24		$	25.14	$	24.16
Diluted tangible book value per ordinary share	$	20.17		$	18.43		$	17.91		$	15.72	$	14.56

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ACE Limited Statutory Accounting Principals to GAAP Reconciliation (in millions of U.S. dollars) (Unaudited)

Reconciliation of Reinsurance Recoverable

A significant amount of detail on a large portion of our reinsurance recoverables are disclosed in our US statutory annual reports. The following is a reconciliation of the amount reported in these reports to our total recoverable as of December 31, 2002 reported for GAAP purposes:

Total amounts reported for statutory purposes	$	8,611
Less: the portion of the total balance that is intercompany and therefore eliminated for GAAP purposes		(2,732	)
Plus: amounts ceded to NICO which are not reported as reinsurance recoverables for statutory purposes		2,767
Plus: the amount of reserve and recoverable discounting included for statutory purposes which is added back for GAAP purposes		1,701
Total GAAP recoverables disclosed in US statutory reports		10,347
Structured settlements		730
Other legal entities(1)		3,853
Total amounts reported for GAAP purposes(2)	$	14,930
Percentage disclosed in detail in US statutory annual reports		69	%

⁽¹⁾ Not subject to US statutory reporting requirements

⁽²⁾ The variance between the Statutory and GAAP balance relates to differences in accounting rules. Statutory rules allow the inclusion of affiliated balances, and the discounting of certain reserves and related recoverables. The statutory balance also excludes retroactive reinsurance contracts (NICO).

	4Q-03			3Q-03			2Q-03			1Q-03			4Q-02			Full Year 2003			Full Year 2002
Consolidated Statement of Comprehensive Income
Net income (loss)	$	421		$	355		$	371		$	247		$	(168	)	$	1,394		$	77
Net unrealized appreciation (depreciation) on investments
Unrealized appreciation (depreciation) on investments		3			(165	)		354			112			131			304			358
Reclassification adjustment for net realized gains (losses) included in net income		(19	)		(24	)		(14	)		(24	)		55			(81	)		98
Cumulative translation adjustment		62			(1	)		57			26			(4	)		144			—
Minimum pension liability adjustment		8			(3	)		(59	)		—			—			(54	)		—
Income tax (expense) benefit related to other comprehensive income items		(2	)		48			(63	)		(16	)		(27	)		(33	)		(118	)
Other comprehensive income (loss)		52			(145	)		275			98			155			280			338
Comprehensive income (loss)	$	473		$	210		$	646		$	345		$	(13	)	$	1,674		$	415

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ACE Limited Glossary

Annualized return on ordinary shareholders’ equity (ROE): Income (loss) excluding net realized gains (losses) less perpetual preferred and mezzanine equity dividend divided by average ordinary shareholders' equity for the period. To annualize a quarterly rate multiply by four.

Combined ratio: The sum of the loss and loss expense ratio, acquisition cost ratio and the administrative expense ratio for the property and casualty and financial services operations.

Diluted book value per ordinary share: Ordinary shareholders’ equity and net proceeds from assumed conversions of outstanding in-the-money options divided by the sum of shares outstanding and the number of options assumed issued.

Diluted tangible book value per ordinary share: Ordinary shareholders’ equity and net proceeds from assumed conversions of outstanding in-the-money options less goodwill divided by the sum of shares outstanding and the number of options assumed issued.

Effective tax rate: Income tax expense divided by the sum of income tax expense and income (loss) excluding net realized gains (losses).

FAS 115: Unrealized gains (losses) on investments and the deferred tax component included in shareholders’ equity.

Life underwriting income: Net premium earned and net investment income less future policy benefits, acquisition costs and administrative expenses.

NM: Not meaningful.

Ordinary shareholders’ equity: Shareholders’ equity less perpetual preferred shares.

Property and casualty combined ratios: Loss and loss expense ratios, policy acquisition cost ratios and administrative expense ratios exclude life reinsurance business and financial services segment.

Return on ordinary shareholders’ equity (ROE): Income (loss) excluding net realized gains (losses) less perpetual preferred securities and mezzanine equity dividends divided by average ordinary shareholders’ equity.

Tangible equity: Shareholders’ equity less goodwill.

Total capitalization: Short-term debt, long-term debt, trust preferreds, mezzanine equity, perpetual preferred shares and shareholders’ equity.

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