London – 21 December 2004 –  Aon Limited, the UK brokerage arm of Aon Corporation, today announced steps to reinforce its commitment to complete transparency in the London insurance marketplace.  The move builds on a series of initiatives Aon introduced in 2001 to bring greater clarity to the way in which brokers are remunerated by underwriters, and is supported by a programme of substantial investment in technology and working processes.

The approach will be rolled out in Aon’s Specialty division, which places complex risks mainly in the London market for global clients, including aviation, marine, energy, property and casualty, terrorism and professional risks.  In the London subscription market, brokers have traditionally performed services for underwriters, such as the preparation and issuing of policy wordings and claims handling, that are handled by underwriters themselves in many other insurance markets. 

Because of recent industry developments, the manner in which brokers are compensated for such services is in transition.  Whatever the model that is ultimately settled upon by London market participants, Aon’s Specialty division will detail all of the services it provides for underwriters and will set out the remuneration received for each class of insurance business.  This will ensure a level playing field for all underwriters that is absolutely transparent to clients.  

This initiative is a further demonstration of Aon’s commitment to transparency, fairness and regulatory compliance and is supported by a survey of over 130 corporate risk managers in the UK, carried out on behalf of Aon Limited, in December 2004. The survey found that 76 per cent of risk managers questioned saw consistency and transparency as the most important issues with regard to remuneration paid to brokers, for services carried out on behalf of underwriters. 

Aon Limited chairman and chief executive officer, Dennis Mahoney, said: “Today we are showing leadership in the market by announcing measures that will help ensure complete transparency and a level playing field for clients and underwriters.  Since 2001 Aon has been at the forefront of driving towards greater transparency within the industry, striving to transform market practices by investing heavily in technology and working processes. 

“We recognise that this is the beginning of a major period of transition for the insurance market and the landscape may well look very different twelve months from now.  In the interim we believe that this approach gives our clients and underwriters clarity on the nature and charges for our services.  We remain absolutely committed to the principles of transparency, fairness and regulatory compliance.”

Aon Limited will collect revenue due under these agreements through to 30 September 2004 and will wind down any existing agreements by 31 December 2004.

About Aon

Aon Limited is the UK arm of Aon Corporation.

Aon Corporation (www.aon.com) is a leading provider of risk management services, insurance and reinsurance brokerage, human capital and management consulting, and specialty insurance underwriting. The company employs approximately 51,000 professionals in its 600 offices in more than 120 countries.  Backed by broad resources, industry knowledge and technical expertise, Aon professionals help a wide range of clients develop effective risk management and workforce productivity solutions.

This press release contains certain statements relating to future results, which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995.  These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from either historical or anticipated results, depending on a variety of factors.  Potential factors that could impact results include the general economic conditions in different countries around the world, fluctuations in global equity and fixed income markets, exchange rates, rating agency actions, resolution of pending regulatory investigations and related issues, including those related to compensation arrangements with underwriters, pension funding, ultimate paid claims may be different from actuarial estimates and actuarial estimates may change over time, changes in commercial property and casualty markets and commercial premium rates, the competitive environment, the actual costs of resolution of contingent liabilities and other loss contingencies, and the heightened level of potential errors and omissions liability arising from placements of complex policies and sophisticated reinsurance arrangements in an insurance market in which insurer reserves are under pressure.  Further information, concerning the Company and its business, including factors that potentially could materially affect the Company’s financial results, is contained in the Company’s filings with the Securities and Exchange Commission.

Aon Limited is authorised and regulated by the Financial Services Authority in respect of insurance mediation activities only.