of their business segments that need to modify or replace significant portions of their computer systems to affect Year 2000 compliance.

The company has reported in SEC filings that the changes will be required to ensure the systems will properly utilise dates beyond December 31, 1999.

Management initiated a company-wide program to prepare various computer systems and selected applications for the Year 2000.

ACE established an oversight committee that meets regularly to review progress towards Year 2000 compliance. The insurer had appointed individuals in each business segment to review all systems to assess their ability to process transactions in the Year 2000.

It was based on these assessments that the Company determined the needed upgrades.

At present, ACE believes that with these modifications and replacements the Year 2000 issue can be adequately addressed.

The company is using both internal and external resources to reprogram or replace, and test these systems for Year 2000 modifications at a cost that is not expected to be material to the firm's financial results.

ACE has also initiated communications with significant business partners to determine the extent to which the Company is vulnerable to those third parties' failure to remediate their own Year 2000 issues.

The company reported it may also have exposure to claims that may be asserted in the future for coverage under certain currently existing insurance policies for damages caused by the failure of insured companies to effectively address their Year 2000 computer problem.

The filings state: "The questions of the extent of such possible future claims on current insurance policies and whether or not such claims are covered by the company's current insurance policies are still being evaluated and the Company has not yet determined if the total costs will be material.

"In addition, the company continues to evaluate its options with regard to issuing future policies that may lead to claims of coverage for Year 2000 related losses.''