EX-10.38 7 dex1038.htm RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED SHARE DIVIDENDS Ratio of Earnings to Fixed Charges and Preferred Share Dividends

 

EXHIBIT 10.38

ACE Limited

 

Computation of Ratio of Earnings to Fixed Charges and Preferred Share Dividends

 

Fiscal year ended December 31   2003   2002     2001     2000   1999

Earnings per Financial Statements

   $ 1,417,482   $ 76,549     $ (146,414 )   $ 542,982   $ 364,963

Add (deduct):

                                  

Provision for income taxes

     278,347     (115,688 )     (78,674 )     93,908     28,684

Fixed charges

     205,758     218,494       219,849       242,783     126,138

Earnings for Computations

     1,901,587     179,355       (5,239 )     879,673     519,785

Fixed Charges

                                  

Interest Expense

     177,425     193,494       199,182       221,450     105,138

One third of payments under operating leases

     28,333     25,000       20,667       21,333     21,000

Total Fixed Charges

     205,758     218,494       219,849       242,783     126,138

Ratio of Earnings to Fixed Charges

     9.2     (1 )     (2 )     3.6     4.1

Preferred Share Dividends

     36,009     25,662       25,594       18,391     –

Total Fixed Charges and Preferred Share Dividends

   $ 241,767   $ 244,156     $ 245,443     $ 261,174   $ 126,138

Ratio of Earnings to Fixed Charges and Preferred Share Dividends

     7.9     (1 )     (2 )     3.4     4.1

 

(1) Earnings for the year ended December 31, 2002 were insufficient to cover fixed charges by $39 million and combined fixed charges and preferred share dividends by $65 million.

(2) Earnings for the year ended December 31, 2001 were insufficient to cover fixed charges by $225 million and combined fixed charges and preferred share dividends by $225 million.