Good day, and welcome to ACE Limited Third Quarter 2014 Earnings Conference Call. Today’s call is being recorded. (Operator Instructions). For opening remarks and introduction, I would like to turn the call over to Helen Wilson, Investor Relations. Please go ahead.

Thank you, and welcome to the ACE Limited September 30, 2014 earnings conference call. Our report today will contain forward-looking statements, including statements relating to company’s performance, pricing and insurance market conditions, and acquisitions including our expected acquisition in Brazil, all of which are subject to risks and uncertainties. Actual results may differ materially. Please refer to our most recent SEC filings as well as our earnings press release and financial supplements which are available on our website, for more information on factors that could affect these matters. This call is being webcast live, and the webcast replay will be available for one month. All remarks made during the call are current at the time of the call and will not be updated to reflect subsequent material developments. Now I’d like to introduce our speakers. First, we have Evan Greenberg, Chairman and Chief Executive Officer, followed by Phil Bancroft, our Chief Financial Officer. Then we’ll take your questions. Also with us to assist with your questions are several members of our management team. Now it’s my pleasure to turn the call over to Evan.

Good morning. As you saw from the numbers, ACE had a record quarter with growth in earnings, driven by growth in both underwriting and investment income. After tax operating income for the quarter was $891 million or $2.42 per share, up 6% versus last year’s third quarter which itself was a record. To the nine months, we have produced $2.5 billion in operating income, up 4% on last year, so again year-to-date a record for our company. Our annualized operating return on equity was 12.6% for the quarter bringing the year-to-date ROE to about 12%, a very good return on shareholder capital while at the same time we continue to invest for the future. As you saw in our announcement yesterday, we’ve received all regulatory approvals needed to close our acquisition of the large corporate P&C business of Itaú Unibanco in Brazil. We now expect to close at the end of the month, well ahead of our original schedule. Our integration teams have been hard at work and we are ready to hit the ground running including our two businesses together. We are excited about the addition of this terrific franchise and the joining of our collective forces. I don’t expect we will miss a beat [ph]. Underwriting results in the quarter were simply excellent. We’ve produced $586 million of total P&C underwriting income, up 5%. Underwriting income growth resulted from both earned premium growth and an outstanding underwriting margin which was essentially flat with last year. Our combined ratio was 86.3, and benefited from strong current accident year results, prior year’s reserve development and relatively light cap losses. All divisions contributed to the good underwriting results. Our overseas general business in particular delivered another standout quarter producing over $340 million of underwriting income, up over 19% and 80% combined…

Thank you, Evan. Starting with investments, strong investment income this quarter benefited from an increase in our cash and invested assets which are up $2.6 billion for the year. Investment income also benefited from an increase in private equity distributions and increased call activity from our corporate bonds. Our average new money rate for the year is 2.8% versus our current book yield of 3.7%. For the past twelve months our operating profits cash flow was $4.5 billion. As I have said on previous calls, our strong cash flow has offset the impact of lower reinvestment rates and we expect this trend to continue. Our cash flow for the third quarter was again strong at $1.1 billion. There are number of factors that impact variability in investment income including the level of interest rates, pre-payment fees on our mortgages, corporate bond call activity, PE distributions and foreign exchange. We currently expect our quarterly investment income run rate to be $550 million. Net realized and unrealized losses were $396 million after-tax, this included losses of $301 million in our investment portfolio primarily due to increasing yields from our corporate bonds, and a $95 million loss from the mark-to-market impact on our variable annuity business. Our investments remain in an unrealized gain position of $1.8 million after-tax. Our net loss reserves were up $93 million and our paid-to-incurred ratio was 88%. We had positive prior period development of $232 million pre-tax, principally from long-tail lines and from accident year’s 2009 and prior. This included $63 million of adverse development for legacy environmental liability exposures in our Brandywine run-off operation which is included in our North American segment. As in the past, we conduct our environmental review in the third quarter and our space [ph] review in the fourth. On the other hand,…

Thank you, Phil. At this point, we’ll be happy to take your questions.

Thank you. (Operator Instructions). And we’ll take our first question from Michael Nannizzi from Goldman Sachs. Michael Nannizzi – Goldman Sachs: So just one question, you mentioned the reinsurance expense ratio, so taking out casualty business out or that comp business out and thinking about some of the structure transactions you’re talking about, I mean is this where you expect the expense ratio to kind of normalize or do you expect to replace a net equivalent contract on – into the comp when it didn’t renew to get that back down? Thanks.

Number one, we don’t expect to replace that contract but the portfolio composition this quarter is different than the portfolio composition you will typically see in the first and second quarter which – by the quarters when we write most of the volume. And I think the expense ratio you see in the first two quarters is closer to what you would see going forward. It’s a mix of business class and most of the business written in the first and second. Michael Nannizzi – Goldman Sachs: Got it. So as we expect the mix of business to more likely approximate what you have now versus that then just given – I’m just trying to figure out like if this is the way…

The third and fourth quarter are the lighter quarters for premium volume, you can’t really – and it depends on the composition of the portfolio, we’re in a competitive reinsurance environment and I can’t tell you with specificity how much cap we’re going to write versus risk property, quote a share versus excess of loss and global versus simply domestic treaty business. It will vary depending on where we see the opportunity to make some underwriting profit. Michael Nannizzi – Goldman Sachs: Got it, thanks. And then taking the other side, thinking about the businesses that seed into the reinsurance market, how are you sort of leveraging what’s taking place there, and where should we begin to see sort of example for that? Thanks

Well I don’t know that you will see examples of that and we’re major buyers of reinsurance as you loan out. We buy it to protect for both, capacity limits greater than we can manage on our balance sheet, retain on our balance sheet, and we also buy reinsurance for volatility and to help spread volatility. We are good buyers of reinsurance, we’re professional at it just like we are on the front end underwriting, and so we will take advantage of what the market has to offer. Michael Nannizzi – Goldman Sachs: Got it. Okay, thank you.

You’re welcome.

And we’ll go now to Jay Gelb with Barclays.

Good morning, Jay. Jay Gelb – Barclays: Good morning. Evan for the fourth quarter where you’re anticipating an improvement in topline growth, does that simply reflect that the third quarter had a headwind from the non-renewals that workers compensation reinsurance program or other factors have play as well?

There are other factors and the business is a bit seasonal, different businesses have a greater weight depending on the quarter that you’re in. And we have been growing at around 7% year-to-date on average, the third quarter was a bit lighter, and the only thing we were signaling was that we expected modestly stronger growth in the fourth quarter from everything we know. Jay Gelb – Barclays: Okay, that’s helpful. And then my second question is on the North American agriculture. We’re all aware the commodity prices have come in and your commentary on the call seem to signal that you’d already taken that into account with the year-to-date accident year pick. And I’m just trying to get a perspective on for the fourth quarter, should we also anticipate around the 90% calendar year combined in agriculture?

Correct. We pegged what we think is the run rate for the year. If we thought that run rate was up we would have – as we did last year, we would have adjusted our combined ratio. But we think as premium earns and this is the proper pegged combined. And we considered – we have reasonably good models, you never know what certainty until the crop is actually harvested, but we know by state, our exposures, we know our crop mix by state, we know our deductible levels by state, and we consider all that in addition to commodity price movements and that’s what all goes into the thinking as we settle on what we think is the combined ratio that reflects the year’s performance, what will be the year’s performance. And by the way we also consider all our protections, reinsurance and commodity hedges. Jay Gelb – Barclays: Clearly, that will be a lot better than the fourth quarter a year ago results?

Well, if we are correct in our estimate and we – as I sit here today and we made that estimate a couple of weeks ago but as I sit here I feel just as good about it. It means that the fourth quarter would be materially better than fourth quarter last year. Jay Gelb – Barclays: Great, that was a lot better than we were thinking. Thank you.

You’re welcome.

And we’ll go now to Kai Pan with Morgan Stanley. Kai Pan – Morgan Stanley: Good morning.

Good morning. Kai Pan – Morgan Stanley: So the first question is on the margins trends. Thank you for giving the market color in terms of pricing and just wonder there are lot moving parts here but if you look out to see if the rate environment is what it is right now and given what the sub loss [ph] trend, do you see in each different line of your business across the globe, shall we expect the core underlying margin to be stable as we have seen in recent quarters or there will be some deterioration or you can see some improvements there?

Kai, a couple of comments I will make about that. As I said in recent calls, depending on the class of business I think the level of rate increases are either not keeping pace with loss cost or barely keeping pace with loss cost. There are a few that are ahead of loss cost and that overtime naturally you look at the kind of combined ratios we’re producing, naturally overtime I would expect the combined ratios to rise, that’s not – again, that’s just natural. Beyond rate and loss cost it’s really about risk selection and portfolio management. And so product mix that is in other tool that you have to help mitigate margin deterioration, and we practice that rigorously. Kai Pan – Morgan Stanley: Thank you.

Makes sense to you? And then the other comment I’d make is look, we’re in the risk business and there is also at the same time there is volatility and losses quarter-to-quarter and that will bounce around, for instance this quarter we had – we’re not out there trying to pound our chest about it, there were greater individual large losses in the short tail business, particularly in energy and aviation, and that impacted the current accident year a bit, but to me it meaning that it was losses outside or normal peg loss ratio and so we recognized those losses in the quarter. But that’s just normal noise in the insurance business where a current accident year is just not a straight line. Kai Pan – Morgan Stanley: Thanks for the answer. My next question actually related to the cap – on the capital measurement sites. You pursue $1.1 billion out of the $1.5 billion authorization, so are we on track to finish our program by year end? And also, do you think the board like it will think these as onetime deal or [ph] on going forward you think about is more a two for you; one to sort of match your share grade; another one being probably more proactive in terms of reducing your shares given that you probably have access capital position?

First of all we are on track to complete our program which is to repurchase up to $1.5 billion, I believe we have repeated that continuously. Secondly, when our board meets in November and when we review – finish reviewing our plans for the year, for the coming year, we look out at opportunities as we view them in the landscape then that’s how we think in totality about our required needs for capital and capital management at that time, and so as part of that we will consider all capital management tools available including share repurchase, and if we anticipate that that will be a tool that we employ for the 2015 year, we will alert the investing community to that fact as we did last year in due course. Kai Pan – Morgan Stanley: Thank you so much.

You’re welcome.

And we’ll go now to Vinay Misquith with Evercore. Vinay Misquith – Evercore: Hi, good morning. Just wanted to follow up on the margin question, you’ve done a good job in the past of business mix change and also chopping some wood in the underperforming countries where you’ve improved your loss in a combined ratio. I’m curious how much of wood is left to chop in the underperforming countries that will help you to keep improving the combined ratio?

I don’t know what wood chop really means, and I don’t know about underperforming countries, I don’t recall speaking about underperforming countries and I don’t even relate to that. I don’t know about underperforming countries. Vinay Misquith – Evercore: Over the last – one last quarter call, I mean there was some commentary saying that not all countries are performing off the bar, so you managed to improve performance in certain countries and that helped the combined ratios. So I was wondering – I mean, do you have something more there that will help you in the future?

Vinay, again, I don’t relate to the comment about countries at all but as far as portfolio management goes which is line of business and its line of business by cohort of insured by territory, by country, that is a constant work in progress. I mean it’s iterative to constantly gain more insights into where are you making money, where are you not in cohorts of risk. And where can you improve your insights on predicting future loss behavior of individual cohorts of risk and that’s a constant work in progress as well, and that helps to – that plus market conditions help to define how your mix of business changes overtime and it will change naturally if you have clear underwriting insight and you know your minds, and you’re constantly working to improve that, and your distribution capabilities and your product innovation help to keep you relevant within the marketplace, then market conditions will then dictate how successful you’d be at each of those efforts and that dictates what is really a dynamic kind of movement in the mix of your business overtime, and helps to meliorate [ph] what is natural grabbing that pulls on combined ratios as rates go one way and loss cost go another. Vinay Misquith – Evercore: So that’s helpful and just one follow up, big 50,000 foot question when you’ve been through various cycles, how does this feel – maybe seeing hide in competition but as it seems lower than the past and claiming that interest rates are now lower do you see a certain amount of discipline in the market?

You know the market is a chaotic place and everybody wants to always put at it a very neat statement, I know you want one and I struggle to give you one. Look, the market is growing more competitive and there are some ends to the market that are behaving in a more ferocious way, reinsurance is an example. And then there are ends of the market like little and small commercial that are behaving in a far more orderly way, and you have every gradation in between, and it varies very much by country and even within large countries, territory, and by line of business and different competitors have a different capability in different territories and behave differently. So the marketplace is dynamic that way, what I would say different than the past, it’s more global, and so you do see some uniform trends at 50,000 feet that where the world is behaving more in locked step because there are major underwriting centers that can move their capacity around the globe rather quickly and that is different than in the past. On the other hand, I do see company’s ability particularly large companies with the analytics and that data they have they are able to do a better job of discipline but at the same time they are always lot of smaller and mid-sized players who are just – they are gunning run and they come in, and they have a way of disrupting market. So you’ve got all that going on right now but the fact is, we’re moving into a softer market. Vinay Misquith – Evercore: That’s helpful, thank you.

And we’ll take our next question from Jay Cohen from Bank of America Merrill Lynch. Jay Cohen – Bank of America Merrill Lynch: Yes, thank you. Two questions, I will just give you both and hopefully you can comment on them. First one, I’m wondering relative to the Itaú acquisition, what you have found give as an update on kind of what you’ve found as your again the integration process. And then secondly, it has been in the press that ACE is interested in forming some sort of internal hedge fund reinsurance operation, I’m not sure if you can comment specifically on that but maybe I’m mean if you can talk about the concept of reinsurance company linking up with an asset management company and generating more of returns from the asset side?

I’ll take your second one first. I’m not going to – as you can appreciate, I’m not going to speculate – we’ll comment on what is kind of rumors and speculation out there. I’m wondering if we have something to say, you know we’ll say it, we’ll be clear about it. As far as more general sense of your calling it hedge fund marrying up, and the investment capability, I maybe see it a little bit differently, and that I think is just a feature. I went in our shareholder letter this year; I went into some link to try to give some thoughts, at least for me, that how I see the marketplace changing. And capital in our business, it’s been a very traditional buy and hold model, for reinsurance, where the capital – where the originators of risk, and underwriters and managers of risk around the world, the primary companies would distribute to buy and hold pools of capital, simply traditional reinsurance. And that I think that overtime as has happened in other asset classes, that well evolve and evolve beyond that, and needs to evolve beyond that because the model constraints how much capacity there is to take on the values of risk that are being created around the world, the values are increasing. I think technology in all its forms, from the math, to the IT informs us that as these tools evolve, we will be able to evolve how we use and harness the capital around the world. I think what you’re seeing right now are glimmers or early steps towards new kinds of buy and hold models potentially that are using other sources of capital. And if it’s a buy and hold, and it’s private and people are – and the purpose is long term gain, not simply annual income, then frankly the investments well remain in conservative and appropriate to an insurance company can evolve. And what it also says is the originators of risk can directly package and provide to the providers of capital, new forms of capital, don’t need a wholesale market in between to do that necessarily. So I just think there is thought around that, there is activity around that, there is talk around that and that is natural, you can’t stand in the way of progress, and you can’t fight against that, if it has – if you think it has a sound premise, and that’s kind of my view of it. And ACE as a large company, is an originator of risk around the globe and with a good reputation for being able to earn a reasonable return on the risk it takes, we’ll necessarily be at the forefront and a leadership role as these things evolve if they make sense to us, it’s our job. Jay Cohen – Bank of America Merrill Lynch: Interesting observations. And then on the Itaú?

John Keogh and I just spent some good time with the Itaú and ACE people in the last two weeks on the granular detail related to implementation and integration, and I can tell you that we are as impressed or more impressed with the leadership, the people, with the culture, with the response of both, the ACE underwriters and team that is a great team in Brazil. And the Itaú team and the positive feeling among both about how one and one is going to equal three here, their insights and their capabilities are simply going to make us better. Jay Cohen – Bank of America Merrill Lynch: Great, thanks Evan.

You’re welcome.

And we’ll go now to Paul Newsome, Sandler O’Neill. Paul Newsome – Sandler O’Neill: Good morning and congratulations on the quarter. I was hoping you might talk a little bit about the M&A environment, and I think at least my experience historically as we get into softer markets we see more stuff coming up for sale and I was wondering if you think that that is emerging as well. And maybe just give us an update of what you think the environment is from a competitive M&A environment?

Look I think M&A activity will increase, particularly around companies that will find it more difficult in this environment to continue with the strategy that has served them in the past and I think there will be more pressure that it holds on performance and as pressure builds on performance that generally is a catalyst for greater M&A activity, I think that’s on the sell side. I think on the buy side typically what happens is there is inflation and what people will pay for properties because it’s just a more competitive environment, others will see no other way of getting their growth or actually keeping themselves from shrinking or margins deteriorating and they see this as their only option, so that hunger builds. So I expect you will see more M&A activity as time goes on, I expect you will see more of a seeding [ph] friendly what comes market. So as we’ve always said, for ACE it’s pretty simple, we have a strategy that we are pursuing for organic growth, if an acquisition comes along, we’ll compliment what we are already doing on an organic basis, and if the returns are favorable for our shareholders, we will pull the trigger, if not, we’re very happy to sit on the sideway. Paul Newsome – Sandler O’Neill: Actually I just had one question. Thank you very much.

Thank you, Paul.

We’ll move now to Meyer Shields from KBW. Meyer Shields – KBW: Thank you, good morning. Evan, you talked a little bit about what the marketplace for cyber and trends look like domestically whether it’s attractive, how it’s growing and all that?

Yes, look the demand for cyber is obviously growing quickly and that’s very good, and it’s among small companies to large companies, all sizes, and ACE is an active participant in the cyber insurance market. I think the question right now, particularly for larger target type risks is the kind of pricing, and the price reflects the actual exposure. And I think in smaller and medium size risks, as the market evolves in many classes, I think that looks – I think pricing is looking reasonable. I think on the larger accounts, that’s the question, so I think there is an appetite to provide the coverage, can you get paid for it. Meyer Shields – KBW: Okay, fantastic. And really quickly, it’s for Phil. The policy acquisition costs on life insurance side has been significant year-over-year, what’s driving that?

It’s simply in the prior year, during the course of this year we saw some expenses that were classified as administrative expenses that we think are now better priced as acquisition expenses. So you will see a decline in acquisition, I mean in admin expenses offset by an increase in the acquisition. Meyer Shields – KBW: Okay, perfect. Thanks so much.

And we’ll take our next question from Cliff Gallant from Nomura. Cliff Gallant – Nomura: Thank you. And I believe in your opening remarks you mentioned growth in professional lines I think it was 4%, I was wondering if you could talk a little bit more about what you see in that line of business? Also if you could update us what’s happening in personal lines on your high net worth class of business? Thank you.

I’m sorry because I didn’t say 4% growth in our professional lines, I said two things. I said I only refer to pricing and so in the large account I said we got rate of about 1.4%, on an average that goes between ENO & DNO [ph] and not-for-profit and then in the smaller risk, medium-sized risk in wholesale market business we got 4% rate. Cliff Gallant – Nomura: Okay.

Okay. And second part of your question? Cliff Gallant – Nomura: It was on…

[Indiscernible] I think we continue to make good progress in that area, I’m pleased with the progress. It’s – we grew 9.5% in the quarter that makes about – that makes the right sense to us, I think there is a good balance between underwriting, our marketing and sales, and customer service, and portfolio insight and management, so we can constantly fine-tune our exposure and our view about pricing depending on the line of the coverage that we’re providing. I think our reputation for service and for consistency is excellent, we run the surveys among our agents and brokers and among our customers, our retention rates are very, very high which speaks very good – obviously if customers aren’t happy they are going to vote with their feet, so I think it speaks to good customer satisfaction, good reputation that way and we’re speaking to [indiscernible]. We’re very focused on the high net worth and to some degree the mass affluent, and we’re not kind of straying away from that, we know the risk profile, and it’s consistent with our vision from the beginning and that’s the brand we’re building. And remember, it takes years to do anything really well and create a great franchise in our industry. Cliff Gallant – Nomura: Thank you very much.

You’re welcome.

And we’ll take our next question from Charles Sebaski from BMO Capital Markets. Charles Sebaski – BMO Capital Markets: Good morning, thank you. Have the – first question about the crop business and a follow up on how last year looked if we look at the fourth quarter and the first quarter this year and a true-up. I’m wondering if you guys are doing anything different today regarding hedging of that portfolio where changes could have a similar outcome or a different outcome with the same kind of events?

First of all, we – and how we manage our selection of – or peg our combined ratios and our estimating process, that has not changed, if that is the same, if anything we have only improved it, it’s more rigorous, we’ve refined it, we’ve worked on our models between last year and this year and we will work on it again between this year and next year. So that remains the same, we just think we’re little better at it. As far as our protections go, our protections vary from year to year, for instance, we bought last quote a share reinsurance this year than we did last year, we’ve been engaged in commodity hedging and that program was a bit more rigorous this year than last year. So the reinsurance and any other protections we have varied by year. Charles Sebaski – BMO Capital Markets: Okay. And in terms of the Itaú, the acquisition in Brazil, is that solely going to be in commercial or is there a personal lines element to that similar to the Mexican and Latin America business as you did previously?

Sure. No, this acquisition is only focused on – is only large commercial but ACE – our business in Brazil, we’ve been there for many, many year’s and our business in Brazil is a mix of large commercial, a very large portfolio of accidental health business, personal accident, and small commercial, medium-sized commercial, and some limited personal lines, more in the high net worth area that we’re incubating there. This acquisition will not directly help us pursue those other channels of growth but what they do, it gives us a bigger image and profile in the country, it gives us greater attention of broad distribution in the country and so it will have a hallow effect that if we execute right we’ll lend a benefit to those other lines of business. Charles Sebaski – BMO Capital Markets: Excellent. Thank you very much.

You’re welcome.

And we’ll go now to Thomas Mitchell from Miller Tabak. Thomas Mitchell – Miller Tabak: Thanks. Firstly, I’m wondering historically it seems like India has always been a very hard place for financial services companies to do business, and I’m wondering if the new government in India has created fresh or new or different opportunities and if you are looking at that area to expand.

Tom, the new government in India is a welcomed statement of change in direction by the electorate in India, the largest democracy in the world; it is a more business friendly government. Their economic, and trade, and investment related policies, the words are the right words and the right language, and Modi has a history, a track record of supporting economic growth and fostering it. I’m hopeful that that will translate into legislation and action that will really help stimulate further growth – accelerate growth in India and I think it will. And for the insurance market, it may create greater opportunity, it may lift the ownership cap from 24% to 49%, ACE is not present as you know in India, we have – but we’re dynamic, we’re constantly probing and looking and if the environment is more favorable and we see the right opportunity and it makes sense to us, then we will take advantage of it and enter the Indian market. So it is on our radar screen, and there you go. Thomas Mitchell – Miller Tabak: That’s very helpful. And my other question is, I’m unsure of the timetable on the federal terrorism, as I understand that we need new congressional action. Is there any new reading on what that looks like going forward?

Congressional action for what? I’m sorry, Tom. Thomas Mitchell – Miller Tabak: For TRIA.

Yes, we do need congressional action. We need congressional action to renew TRIA. And when you look at the risk of terrorism today, which is greater than the risk has been, I consider it irresponsible of Congress to keep TRIA as a question mark around the certainty of government backstop a protection that is bad for the economy, it is bad for business. Business thrives in an environment of greater certainty. Both houses know and both parties know what needs to be done to renew TRIA. The difference between them is not great, and the only thing they can take time for is campaigning rather than legislating to the benefit of our country, is shameful to me. Thomas Mitchell – Miller Tabak: Well put. Thank you very much.

(Operator Instructions) And we’ll go now to Ian Giverman [ph] with Balsun [ph] Investments.

Hi, thank you. Evan my first question is, on the crop it looked like there was a footnote in the supplement that the hedging helped to something in my math is right, Phil it looked like about $40 million, is that pretty close? And secondly, am I understand right that that went through the combined ratio?

It was $45 million and it’s in the combined ratio, absolutely.

Got it. Okay, great. Thank you. Secondly, Evan did comment on the environment as pricing little bit was a wholesale for holding it better than retail and I guess I would have thought the opposite just we have a several lot of access capacity in the market and it’s a lot easier to enter wholesale especially if you have Bermuda at London than to get a casualty retail. So A, are you surprised that? And B, why do you think it’s happening and will precision [ph] think wholesale is just lagging in capital for retail?

Ian, good question. Chaotic market, so here it depends how you’re defining wholesale. When I was talking about the U.S., I was talking about our wholesale, ENS and specialty business which is the Westchester and Commercial Risk Services, and those both grew nicely and thereafter that middle market and small commercial, and yes, they have offices around the U.S. and they are dealing with the U.S. wholesalers, and their pricing help up better. On the other hand, I said our Lloyd’s operation shrank 6.5% and I said our ACE Bermuda operation which is large risk wholesale shrank 10%, and there pricing is more competitive.

Got it. So you’re not seeing – I mean we’ve seen you obviously are aware sort of become flavor of – maybe not the month but flavor of the last couple of years for the guys who are struggling with reinsurance to try to set up, honest to our U.S. wholesale divisions, did those people were in the market in the mid-small county had been?

They haven’t gotten quite to it yet, it’s harder work. You got to have underwriters, the business is placed locally, it doesn’t just box itself up into one place. So you got to be present in Chicago, and L.A., and San Francisco, and Atlanta, and Boston, and New York; you got to have underwriters across a broad swath of lines of business and you got to really have the relationship. It’s flow business and trades move fast, and you got to have the confidence of the brokers, and not just – you know that’s not instant. By the way easier form to get access than primary, the best work on access [ph] than you do on primary, so a lot of those guys are doing better with the writing access and it will be actually on larger account business than the smaller account.

Got it. And then my final one, I hate to bring up your favorite topic but the A, reinsurance with interest rates back to the lows again, I guess I was looking at your old disclosure from a few years back and when you gave the scenarios and sure the more cautious scenario had a tenure, I think it was north of 2.5, I want to say 2.6 maybe, and obviously a much lower S&P than we are at today so maybe those offset but I guess also I think about halfway through the annuitization phase. I was wondering if you can just give us any update on what you’re seeing from annuitization phase [ph] and what is sort of benefit of a higher market to reverse the offset of lower interest rates and you’re hoping for few years ago?

Ian the annuitization and lapse rates, we study those on the portfolio and so we look at our actual experience versus our expected, and we’re just completing studies and reviewing them in that area for the year and we’re not seeing anything in aggregate that gives us concern that we’re not pegging them correctly. So those seem okay to us.

Got it.

Equity market are ahead of what we expected, interest rates are lower, and I also don’t believe that the ten year – word of volatile movement on interest rates right at the moment. And there has been a sort of risk off trade because there is the complex picture about economic and geopolitical at the moment, I don’t believe the ten year rate is going to remain where it is.

Understood. Say, the trend I think at primary players is that in lapse has been much lower and actual choice of annuitization has been much lower than expected, is that reasonable expect just seems from our trends?

What we have seen is certainly less utilization from an annuitization standpoint and lapse is, maybe marginally lower than we were expecting but net-net we don’t think that the experience is going to change our view.

Perfect. Thanks so much.

You’re welcome.

And we will take our final question of the day from Jay Cohen from Bank of America Merrill Lynch. Jay Cohen – Bank of America Merrill Lynch: Yes, thanks. Just one more follow up and it’s related to a news item that came out [ph] the day before about ACE suggesting it may exclude Ebola coverage from certain geopolicies. I have not heard that from others, I’m wondering why are you the only one to doing it. And secondly, what prompted this action?

Thank you for asking me that question Jay. I can’t comment on what others are doing but I’ll comment a little bit about ACE. I read the press report, we all did, that in my mind attempts to sensationalize normal common-sense underwriting. Look, as underwriters we start with the facts to understand the risk exposures of our clients on a case-by-case basis. These exposures for example include the types of activities they are engaged in, the locations where they take place and the kind of safety protocols that they employ. We have many tools to manage price risk, we can offer full coverage, we can sublimit exposures, we can exclude the coverage altogether and we can vary the price we charge depending on the exposure we assume. The Ebola endorsement referenced in our U.S. global casualty unit is only one of many tools that are disposal and we’re using it selectively and on a case-by-case basis, it’s not being applied in some indiscriminate, unilateral or blanket way to address the Ebola risk. Does that kind of… Jay Cohen – Bank of America Merrill Lynch: Yes, now that’s helpful. I wasn’t – that made it clear then what I have been reading about in the press. So that was helpful.

Thanks, Jay.

Thank you everyone for your time and attention this morning. We look forward to speaking with you again at the end of the next quarter. Thank you and good day.

And ladies and gentlemen, this does conclude today’s conference. And we do thank you for your participation.