NEW YORK (Bloomberg) - Ace Ltd., the Swiss insurer operating in more than 50 countries, said it will buy back as much as $600 million in shares to limit dilution from issuing stock to employees.

The insurer may buy the stock through the end of 2012, Zurich-based Ace said today in a statement distributed by Business Wire.

Ace's board of directors yesterday declared a quarterly dividend equal to 33 cents payable on January 11, 2011, to shareholders of record at the close of business on December 16, 2010, subject to a required filing with the Swiss Commercial Register.

Dividend payments will be made in US dollars (USD) by the company's transfer agent.

In connection with the dividend payment, the company's par value, currently 30.89 Swiss francs (CHF) per share, will be reduced on the record date by the CHF equivalent of 33 cents per share based on the USD/CHF rate published on December 13, 2010.

This will be the third of four par value reduction instalments as approved by the company's shareholders on May 19, 2010.

The company also announced its board authorised the repurchase of up to $600 million of Ace's common shares through December 31, 2012, to offset, in whole or in part, potential dilution from the exercise of stock options and granting of restricted stock under the company's equity-based incentive plans.

This repurchase authorisation, which may be implemented in any given quarter, year or multi-year period, in the open market, in privately-negotiated transactions, block trades, accelerated repurchases and/or through option or other forward transactions, replaces the November 2001 authorisation for the repurchase of up to $250 million of any Ace issued debt or capital securities, including common shares.

To date, no shares have been repurchased under the November 2001 authorisation.