ACE Limited to Pursue IPO of Its Financial Guaranty Business.

Business Editors

HAMILTON, Bermuda--(BUSINESS WIRE)--Dec. 2, 2003

ACE Limited (NYSE:ACE) today announced it intends to pursue an initial public offering (IPO) of its financial guaranty business. The new company will be a Bermuda-based holding company that will acquire the stock of ACE's subsidiaries that conduct its financial guaranty business, which include ACE Guaranty Corp. and ACE Capital Re International Ltd. The new company expects to file a registration statement with the U.S. Securities and Exchange Commission by year-end and complete the IPO in the first half of 2004, subject to market conditions and receipt of various regulatory approvals.

ACE expects to offer approximately 65% to 75% of its interest in the new company. The amount ACE will receive in the IPO will depend on market conditions and on other factors.

"While we are limited by regulatory requirements in what we can say at this time, the move to pursue an initial public offering is a result of both a strategic and capital allocation decision and not due to any change in our fundamental outlook for our operations," said Brian Duperreault, Chairman and Chief Executive Officer of ACE Limited. "We expect to retain the bulk of the proceeds to support incremental growth in our remaining operations and to further strengthen our already solid balance sheet."

A registration statement relating to these securities has not yet been filed with the Securities and Exchange Commission. These securities, if registered, may not be sold nor may offers to buy be accepted prior to the time the proposed registration statement becomes effective. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities of the new company. The offering will be made only by means of a prospectus contained in the registration statement to be filed by the new company with the Securities and Exchange Commission.

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, The 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.

Application of the Safe Harbor of the Private Securities Litigation Reform Act of 1995:

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 market conditions, regulatory actions, competition, rating agency actions and economic, political, and business conditions 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.