Ace Ltd. will become a Swiss company, provided shareholders back the plan next month at what is likely to be the insurance giant's last annual general meeting to be held in Bermuda.

Chairman and chief executive officer Evan Greenberg said that the company will effectively become "a Swiss citizen" in a letter to shareholders that appears at the front of a prospectus filed with the US Securities and Exchange Commission last Friday.

Even though Ace's holding company has been in the Cayman Islands since the insurer was established in 1986, it has long been regarded as the biggest player in the Bermuda insurance market, with 'Ace Global Headquarters' the address of its Woodbourne Avenue building.

The company announced in March it intended to redomesticate its holding company from the Caymans to Switzerland — now it appears Ace's headquarters will move to Europe with it.

Item 11 on the agenda of the AGM is "to confirm the principal place of business of the company as Zurich, Switzerland".

Ace's departure will be a huge loss to the Bermuda market. According to Fitch ratings, its net premium written in 2007 totalled nearly $12 billion, more than a quarter of the total achieved by the 22 companies surveyed by Fitch and way ahead of the next largest figure from a Bermuda insurer, XL Capital's $7.1 billion. Last year, Ace posted record profits of $2.6 billion.

Incorporation "in a major financial centre of high repute known for its stability and financial sophistication" would be in the best interests of Ace shareholders, Mr. Greenberg said. "Simply put, we determined that our current place of domicile [the Caymans] represents an underutilised asset with potential downside risks and little attendant upside. We believe the Continuation [re-domestication] will reduce reputational, political, regulatory, and financial risks to our company."

In his letter, Mr. Greenberg mentioned Bermuda by name only once — to give notice of Ace's AGM on the Island, starting at 8 a.m. on Thursday, July 10.

Mr. Greenberg wrote: "As a strategy holding company in Switzerland, we will have our headquarters in Zurich and we will hold future annual general meetings and at least half our board meetings there.

"We will be, in effect, a Swiss citizen, covered by a network of Swiss treaties and international relationships, including tax treaties providing certainty and predictability. We will also incorporate Swiss operating insurance companies, which will be regulated by the Swiss Federal Office of Private Insurance."

Mr. Greenberg added: "We will continue our legal existence in Switzerland as if we had originally been incorporated under Swiss law. Each outstanding share of Ace as a Cayman Islands company will then represent one share of Ace as a Swiss company."

Ace will continue to trade on the New York Stock Exchange and will continue to report its financial results in US dollars, the CEO added.

"Since our incorporation in the Cayman Islands more than 22 years ago, we have grown to become a major NYSE-listed company with substantial global operations," Mr. Greenberg wrote. "Half of our business is in the US, and we have significant presence throughout the world, including Europe, Asia and Latin America.

"We therefore believe the redomestication to Switzerland achieves a number of important benefits to us, with little impact on net expense and effective tax rate, and that it will substantially increase our strategic and capital flexibility while posing no noticeable risks to our operating model or our long-term strategy.

"We have chosen to redomesticate Ace to Switzerland because of its political, economic and regulatory stability; tradition of respecting the rule of law; sophisticated financial regulation; network of excellent relations with major developed and developing countries around the world; reliable tax treaties; and centuries-old tradition of capitalism."

In the three months since announcing its intentions, Ace has insisted the move will involve no changes to its Bermuda operations, but has not made it clear whether the Island would still have the "global headquarters".

Asked directly whether the headquarters would remain on the Island, Mr. Greenberg told this newspaper, while he was on the Island last month: "These are Ace Ltd.'s principal executive offices. Ace is a truly global company and has other executive offices elsewhere.

"Ace Group Holdings' executive offices are in New York, for example. The global headquarters of our holding company will be in Zurich, Switzerland. This will not diminish our presence in Bermuda, it only diminishes our presence in Cayman. This will enhance our company overall, including our operations in Bermuda."