share) for the year to September 30, after adding fourth quarter net income of $86.9 million ($1.46 per share).

The year's bottom line represents a near 22 percent increase over fiscal '95, while the fourth quarter result amounted to about a $73,000 improvement this year over the comparative period last year.

The company's assets grew by more than $1.3 billion to $4,574,358,000 in the year to September 30.

Net premiums written for the fourth quarter improved by nearly 42 percent from $424.8 million to $602.7 million. Net premiums earned rose 37 percent from $428.7 to $587.2 million.

But financial lines took over from D&O as ACE's number two premium.

In the competitive excess liability market, premium writings dropped more than 15 percent from $239.1 million to $202.3 million; D&O premium writings dropped seven percent from $105 million to $97.6 million and the financial lines went from $9.2 million in its infancy year to $119.2 million in this first full year.

Other lines of business making major strides include satellite (from $45m to $85.3m), aviation (from $7.0m to $27.1m), excess property (from $5.3m to $13.9m).

ACE has also derived the benefit of one quarter from Tempest Re's property catastrophe line with $34.8 million in premium writings.

ACE chairman, president and CEO Brian Duperreault commented: "The success of our strategic diversification over the past two years is clearly evident today. Through development of new product lines and the recent acquisitions of Methuen Group Ltd. (Methuen) and Tempest Reinsurance Co. Ltd., ACE has constructed a solid foundation upon which to grow.'' Mr. Duperreault continued: "This quarter, our balance sheet and financial results reflect the positive contribution of Tempest. We are pleased to advise that Tempest recently received an A.M. Best Company rating of A (Excellent) as a stand alone subsidiary, which matches the A (Excellent) rating for the other insurance subsidiaries of ACE Ltd., namely ACE Insurance Company, Ltd. and Corporate Officers & Directors Assurance Ltd.'' Mr. Duperreault also said, "The large increase in premium volume in 1996 versus 1995 is due to our new lines of business, particularly satellite and financial lines, and the inclusion of Tempest.

"The decrease in premiums in our excess liability and directors & officers liability lines reflect market conditions as well as the impact from the reduction in integrated occurrence limits.'' The significant increase in the value of ACE stock during the year (some $18 higher since January 2), has meant that ACE has recorded expenses for stock appreciation rights representing 12 cents per share for the fourth quarter.

Total investments and cash increased 32.7 percent to $4.2 billion at September 30.

Net investment income, excluding net realised gains, was $60.4 million for the fourth quarter (1995: $46.6 million) and $206.5 million for the year (1995: $181.4 million).

Brian Duperreault