ACE: Investment in Emerging Markets Threatened by Lack of Ongoing Political Risk Assessment

Global businesses need to adopt formal structures to assess the
ongoing risks posed by political instability and unrest in emerging
markets if they are to protect their growing investment in these
areas, according to leading international and speciality insurer ACE
Global Markets (ACE)(NYSE:ACE).

Nearly 30% of senior executives and risk professionals surveyed
for the latest global risk briefing report, conducted by the Economist
Intelligence Unit (EIU) and sponsored by ACE, said their companies had
been forced to cancel existing investments in emerging markets because
of concerns about political risks. ACE believes that this points to a
potential gap in the risk assessment process both in terms of an
understanding of the risks and the level of ongoing risk management
these companies make for existing investments.

For most companies, risk management is concentrated on the period
when an investment opportunity is being considered. 80% of respondents
said they consider political and operating risk as part of the due
diligence process. However, only 44% revealed they monitor and manage
risk on a continuous basis once the investment has been made.

Commenting on the report's findings, Julian Edwards, Head of
Political Risk at ACE Global Markets, said: "Emerging markets remain
highly volatile but with these risks comes clear investment rewards.
However, without formal processes businesses face potential exposure
to unnecessary and additional risks which can impact directly on the
performance of their investment and, in some circumstances, lead to
cancellation."

Over half of those surveyed said the risks associated with
investing in emerging markets have increased in the past three years
and in response many companies are increasing the time and resources
dedicated to risk management. The survey also showed that stability of
political regimes was the one of the most significant threats to
operations in emerging markets. In the past three years, the vast
majority of companies that already invest in emerging markets (79%)
deepened their investment over the period. 64% reported that rewards
have increased.

Commenting on the findings Julian Edwards said: "The results of
the global risk briefing clearly shows the growing appetite for
extending investment in emerging markets. But, with less than half of
those surveyed performing ongoing risk assessment as part of their
investment programme the pace of growth and the potential returns
could be affected. There is no doubt that maintaining a structured
approach to risk management is crucial."

Notes to editors:

ACE

ACE European Group has established branch offices in 16 countries
across Europe, Freedom of Services permissions to operate in 27 EEA
countries and affiliate offices in Egypt, Bahrain and Pakistan.

ACE European Group comprises the operations of ACE Europe, ACE
Global Markets and ACE Tempest Re Group. ACE Europe provides a range
of tailored Property and Casualty, Accident and Health and Personal
Lines solutions for a diverse range of clients. ACE Global Markets
(AGM) is ACE's specialty international business, underwriting through
ACE's Lloyd's Syndicate 2488 and UK registered company ACE European
Group Limited. Specialty lines include excess and surplus lines
business, Marine, Aviation, Energy and Political Risk as well as
Property, Financial Lines and Accident and Health. Additional
information on ACE European Group can be found at
www.aceeuropeangroup.com.

The ACE Group of Companies is a global leader in insurance and
reinsurance serving a diverse group of clients. Headed by ACE Limited
(NYSE: ACE), a component of the Standard & Poor's 500 stock index, the
ACE Group conducts its business on a worldwide basis with operating
subsidiaries in more than 50 countries. Additional information can be
found at: www.acelimited.com

ACE Political Risk

As one of the most experienced political risk insurers in the
world, ACE offers innovative and comprehensive solutions that deliver
confidence, security and peace of mind to clients across the globe.
ACE possesses broad knowledge and understanding of the intricacies of
country and credit risk and continues to lead ongoing development in
this field, including the evolution of many political risk lines. ACE
provides cost-effective strategies to mitigate cross border risk.
Solutions are customer driven, but designed around 4 categories:
financial institutions, exporters and importers, equity investors and
contractor's plant and equipment.

About the research

The Economist Intelligence Unit surveyed 177 executives around the
world in October 2006 about their attitudes to operating risk
management in the context of emerging market investments. The survey
and paper was sponsored by ACE, IBM and KPMG.

Respondents represent a wide range of industries and regions, with
roughly one-third each from Asia and Australasia, North America and
Western Europe. Approximately 50% of respondents represent businesses
with annual revenue of more than US$500m. All respondents have
influence over, or responsibility for, strategic decisions on risk
management at their companies.