London: 10 November 2004 - The airline sector continued to enjoy significant insurance premium reductions for the third quarter of 2004, according to Aon’s 2004 Third Quarter Airline Insurance Market Review. Typical airline renewals saw average hull rate reductions of 12% and liability reductions of 13% compared with the third quarter in 2003.

Despite the lower rates, the overall volume of insurance premium to the airline sector showed an increase of 3% over the corresponding quarter in 2003, the first volume increase in any quarter in 2004. This was due to the significant influence of some large renewals and the growing exposure levels in terms of aircraft values and passenger numbers. Annually, insurance rates have now fallen by an average of 16% for hull cover and 13% for liability classes.

Commenting on the findings, Steve Doyle, Manager of Aon’s Global Aviation Practice, said: “The third quarter represents only 15% of the annual airline insurance programmes with the significant majority renewing in the final quarter. Despite this, we are continuing to see rate reductions coupled with a continuation of comparatively low loss levels. Indeed, 2004 to date is showing the best loss performance of the last five years.

“A number of factors such as the reducing age of the global airline fleet, investments in technology and more awareness of security and safety are clearly contributing to this low loss record, which now looks like more of an enduring trend as opposed to a temporary blip,” Doyle added.

Notes to Editors

About Aon
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 regulatory 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.