BAE Systems, the global defence, security and aerospace company, has signed a five year insurance deal through its insurance broker Aon and with its partner insurers. This insurance programme is aligned to the company’s five year business planning and budgeting cycle and ensures long term cost certainty at a time when premiums are predicted to increase in 2009.

BAE Systems is the first private sector business to adopt Aon’s aligned long term programme (ALTP) – an insurance package that supports an organisation’s long term financial planning. The deal was initially pioneered in March 2008 for regulated business Network Rail to fit in with their regulatory period from 2009-14.

The insurance programme for BAE Systems provides certainty of cover and pricing for property and general liability risks with significant capacity for catastrophes, including earthquake and windstorm, which traditionally renew on an annual basis.

In conjunction with Aon, BAE Systems has focused on building partnerships with insurers, enabling underwriters to become more familiar with the company’s financial strategies and in turn allowing the company to negotiate the best cover and price.

Trevor Young, Aon’s strategic account broker for BAE Systems, said: "BAE Systems deserves credit for its commitment to nurturing insurer relationships to meet the wider business goals. The deal is key to supporting the company’s defined financial strategy and is a quantum step away from the annual burden of the renewal process. The placement of the insurance programme also comes at an opportune time as we enter a difficult market cycle that could see premium increases."

Paul McDonald, Director of Insurable Risk Services at BAE Systems commented: "Our partnership evolution with insurers and Aon means we’ve achieved absolute cost and capacity certainty, removing volatility in our insurance programme. This is critical for our businesses given the long-term nature of our contracts."

Ends

For more information contact:

Alexandra.lewis@aon.co.uk

Alexandra Lewis

020 7882 0541

About Aon

Aon Corporation (NYSE: AOC) is the leading global provider of risk management services, insurance and reinsurance brokerage, and human capital consulting. Through its 36,000 colleagues worldwide, Aon readily delivers distinctive client value via innovative and effective risk management and workforce productivity solutions. Our industry-leading global resources, technical expertise and industry knowledge are delivered locally through more than 500 offices in more than 120 countries. Aon was named the world's best broker by Euromoney magazine's 2008 Insurance Survey. In 2008, Aon ranked highest on the Business Insurance ranking of the world's largest insurance brokers based on commercial retail, wholesale, reinsurance and personal lines brokerage revenues. Aon also was ranked by A.M. Best as the number one insurance broker based on brokerage revenues in 2007 and 2008, and was voted best insurance intermediary, best reinsurance intermediary, and best employee benefits consulting firm in 2007 and 2008 by the readers of Business Insurance. Sign up to receive Aon news alerts by email or RSS feed at: http://aon.mediaroom.com/index.php?s=58.

Safe Harbour Statement:

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

About BAE Systems

BAE Systems is the premier global defence and aerospace company delivering a full range of products and services for air, land and naval forces, as well as advanced electronics, information technology solutions and customer support services. With approximately 100,000 employees worldwide, BAE Systems' sales exceeded £15.7 billion (US$ $31.4 billion) in 2007.

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LONDON, 23 February 2009