The Company's global insurance risk engineering operation, XL GAPS, will also be offering assistance on earthquake emergency preparedness and other risk services expertise. In addition to grants made by the XL Foundation to support the disaster recovery and rebuilding efforts, the Company will match employees' donations to CYDF's Project Hope Emergency Disaster Relief Action.

XL CEO Michael S. McGavick said: "Given the magnitude of the loss of life and damage caused by the recent earthquake in China, XL is committed to providing relief in this area. It is a tragic fact that children are one of the most affected groups in the disaster area. Rebuilding a school and a library, and offering scholarships with funds provided by the XL Foundation, will support children impacted by this tragedy to continue their studies and regain some stability in their lives. By partnering with an organization like China Youth Development Foundation, XL's aim is to carry out this rebuilding initiative in the most effective way possible."

XL Capital Ltd, through its operating subsidiaries, is a leading provider of global insurance and reinsurance coverages to industrial, commercial and professional service firms, insurance companies and other enterprises on a worldwide basis. As of March 31, 2008, XL Capital Ltd had consolidated assets of $54.8 billion and consolidated shareholders' equity of $9.3 billion. More information about XL Capital Ltd is available at www.xlcapital.com.

SOURCE XL Capital Ltd

http://www.xlcapital.com

XL is actively working to resolve its exposure to SCA and while Fitch views successful resolution of this exposure as a positive, the size of any charges, and the manner in which XL funds any charges, could have an impact on the ratings. Fitch envisions if a large charge is ultimately taken that is not offset by an equity-like capital raise, ratings would likely be downgraded by one notch. If there are no additional charges or they are modest, or if a capital raise is executed in the event of a larger charge, Fitch would likely affirm the ratings and return to a Stable Outlook.

XL is a Bermuda-headquartered holding company with subsidiaries providing insurance and reinsurance on a worldwide basis. The company reported consolidated GAAP assets of $54.8 billion and shareholders equity of $9.3 billion at March 31, 2008. The company's equity-adjusted debt to total capital was 18.4% at that date.

Fitch has placed the following ratings on Rating Watch Negative:

XL Capital Ltd

--IDR 'A';

--$600 million 5.25% senior notes due 2014 'A-';

--$350 million 6.375% senior notes due 2024 'A-';

--$745 million 5.25% senior notes due 2011 'A-';

--$325 million 6.25% senior notes due 2027 'A-';

--6.375% series E preferred ordinary shares 'BBB+'.

XL Capital Finance (Europe) PLC

--IDR 'A';

--$600 million 6.50% guaranteed senior notes due 2012 'A-'.

XL America Inc.

--IDR at 'A';

--$255 million 6.58% senior notes due 2011 'A-'.

Fitch also placed the 'A+' IFS ratings of the following XL Capital Ltd (re)insurance subsidiaries on Rating Watch Negative:

--XL Insurance (Bermuda) Ltd

--XL Re Ltd

--XL Insurance Switzerland

--XL Re Latin America Ltd

--XL Europe Ltd

--XL Insurance Company Limited

--XL Insurance America, Inc.

--XL Reinsurance America Inc.

--XL Re Europe Limited

--XL Insurance Company of New York, Inc.

--XL Specialty Insurance Company

--Indian Harbor Insurance Company

--Greenwich Insurance Company

--XL Select Insurance Company

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.

SOURCE: Fitch Ratings

Fitch Ratings, Chicago
Tana M. Higman, 312-368-3122
James B. Auden, CFA, 312-368-3146
or
Media Relations:
Kenneth Reed, 212-908-0540, New York

The capital raising initiative follows XL's agreement to extinguish certain exposure the company had to Security Capital Assurance Ltd (SCA) including its facultative reinsurance contracts and excess of loss reinsurance contract. In addition, SCA operating subsidiaries XL Financial Assurance Ltd (XLFA) and XL Capital Assurance Inc. (XLCA) commuted the quota share agreement between these two companies, extinguishing XL Insurance (Bermuda) Ltd's guarantee to XLCA of XLFA's obligations there under. In exchange for the commutation and termination of the various agreements, XL will transfer $1.775 billion in cash and eight million shares of XL common stock to SCA and transfer all of XL's SCA shares to a trust.

With the capital raising and payment to SCA completed and the planned redemption of $255 million of guaranteed senior notes, Fitch estimates XL's equity-adjusted debt-to-total capital, excluding any FAS 115 adjustment for unrealized losses, on a pro forma basis to be 22.0%, up slightly from 21.4% at June 30, 2008. Due to the size of the issuance relative to XL's market capitalization, Fitch believes the company's financial flexibility has been reduced since it would be difficult for the company to tap the capital markets again in the near term should the company suffer another large loss.

The Stable Outlook reflects Fitch's belief that while XL's operating performance will be hampered due to soft market conditions, the company will continue to produce underwriting results on par with comparably rated peers. In order to maintain its current ratings, XL must demonstrate consistent underwriting profitability and put an end to the large charges that have plagued the company and hampered its ability to grow its capital base.

Fitch believes XL's investment portfolio remains susceptible to additional mark-to-market losses given continued credit market volatility especially related to commercial and residential mortgage-backed securities; collateralized debt obligations (CDOs) and financial sector and consumer cyclical holdings.

Fitch notes that over the past six years, XL's volatility of earnings has been greater than peers due to a series of large charges attributable to credit market conditions, catastrophe losses, adverse prior-year loss reserve development, and charges related to the Winterthur arbitration.

The company has announced a number of changes designed to increase the stability of earnings and capital including the exploration of strategic alternatives for its life reinsurance business, potential future realignment of its investment portfolio and simplification of its management structure. Additionally, XL has reduced its catastrophe exposure and Fitch believes the company's overall loss reserve position is stronger than in recent years.

XL is a Bermuda headquartered holding company with subsidiaries providing insurance and reinsurance on a worldwide basis. XL reported consolidated GAAP assets of $52.1 billion and shareholders equity of $8.8 billion at June 30, 2008.

Fitch assigned the following ratings with a Stable Outlook:

XL Capital Ltd

--$575 million 10.75% equity units at 'A-';

--$500 million series C preference ordinary shares at 'BBB+'.

Fitch withdrew the following rating:

XL America Inc.

--IDR at 'A';

--$255 million 6.58% senior notes due 2011 at 'A-'.

Fitch has affirmed the following ratings and simultaneously removed them from Rating Watch Negative; The Outlook is now Stable:

XL Capital Ltd

--IDR at 'A';

--$600 million 5.25% senior notes due 2014 at 'A-';

--$350 million 6.375% senior notes due 2024 at 'A-';

--$745 million 5.25% senior notes due 2011 at 'A-';

--$325 million 6.25% senior notes due 2027 at 'A-';

--6.375% series E preferred ordinary shares at 'BBB+'.

XL Capital Finance (Europe) PLC

--IDR at 'A';

--$600 million 6.50% guaranteed senior notes due 2012 at 'A-'.

Fitch also affirmed the IFS ratings of the following XL Capital Ltd (re)insurance subsidiaries at 'A+' and removed them from Rating Watch Negative:

--XL Insurance (Bermuda) Ltd

--XL Re Ltd

--XL Insurance Switzerland

--XL Re Latin America Ltd

--XL Europe Ltd

--XL Insurance Company Limited

--XL Insurance America, Inc.

--XL Reinsurance America Inc.

--XL Re Europe Limited

--XL Insurance Company of New York, Inc.

--XL Specialty Insurance Company

--Indian Harbor Insurance Company

--Greenwich Insurance Company

--XL Select Insurance Company

The Rating Outlook is Stable.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.

SOURCE: Fitch Ratings

Fitch Ratings, Chicago
Tana M. Higman, 312-368-3122
James B. Auden, CFA, 312-368-3146
or
Media Relations:
Cindy Stoller, 212-908-0526, New York

U.S. Multi-Line Insurance Index (AMBUML) +2.17%

Global Multi-Line Insurance Index (AMBGML) +0.99%

European Insurance Index (AMBEUR) +0.84%

Global Reinsurance Index (AMBGR) +0.76%

Global Composite Index (AMBG) +0.05%

Global Life Insurance Index (AMBGL) -0.05%

Asia/Pacific Insurance Index (AMBAP) -0.06%

U.S. Life Insurance Index (AMBUL) -0.42%

U.S. Insurance Index (AMBUS) -0.42%

Global Non-Life Insurance Index (AMBGNL) -0.48%

U.S. Life and Health/HMO Insurance Index (AMBULH) -0.78%

U.S. Property/Casualty Insurance Index (AMBUPC) -0.84%

U.S. Health and HMO Insurance Index (AMBUH) -1.29%

Global Insurance Brokers Index (AMBGB) -2.04%

U.S. Insurance Brokers Index (AMBUB) -2.41%

The U.S. Insurance Index (AMBUS) closed at 924.77 (-0.42%). Leading the AMBUS were AIG (+5.82%) and American Physicians Capital (+4.01%). Trailing the AMBUS were XL Capital (-8.55%) and Penn Treaty American (-4.86%).

The European Insurance Index (AMBEUR) closed at 1203.47 (+0.84%)%. Leading the AMBEUR were Benfield Group (+6.27%) and Euler Hermes (+3.82%). Trailing the AMBEUR were Aviva (-2.69%) and Beazley Group (-1.55%).

The Asia/Pacific Insurance Index (AMBAP) closed at 1325.62 (-0.06%). Leading the AMBAP were China Insurance International Holdings (+4.35%) and Korean Reinsurance Co. (+2.59%). Trailing the AMBAP were Hyundai Marine & Fire Insurance Co. Ltd. (-8.26%) and Dongbu Insurance Co. (-6.13%).

The Global Reinsurance Index (AMBGR) closed at 1181.69 (+0.76%). Leading the AMBGR were China Insurance International Holdings (+4.35%) and Euler Hermes (+3.82%). Trailing the AMBGR were XL Capital (-8.55%) and Odyssey Re Holdings (-3.74%).

The Global Broker Index (AMBGB) closed at 1023.94 (-2.04%). Leading the AMBGB were Benfield Group (+6.27%) and Jardine Lloyd Thompson Group plc (+3.81%). Trailing the AMBGB were Brown & Brown (-3.49%) and Marsh & McLennan Cos. (-3.10%).

The Global Multi-Line Insurance Index (AMBGML) closed at 938.80 (+0.99%). Leading the AMBGML were AIG (+5.82%) and American National Insurance (+0.99%). Trailing the AMBGML were Assurant (-2.97%) and Atlantic American Corp. (-1.94%).

The Global Nonlife Insurance Index (AMBGNL) closed at 1128.99 (-0.48%). Leading the AMBGNL were American Physicians Capital (+4.01%) and Euler Hermes (+3.82%). Trailing the AMBGNL were XL Capital (-8.55%) and Hyundai Marine & Fire Insurance Co. Ltd. (-8.26%).

The Global Life Insurance Index (AMBGL) closed at 1036.55 (-0.05%). Leading the AMBGL were China Insurance International Holdings (+4.35%) and ING Groep N.V. (+3.48%). Trailing the AMBGL were Penn Treaty American (-4.86%) and Independence Holding Co. (-4.40%).

The U.S. Property/Casualty Index (AMBUPC) closed at 1087.58 (-0.84%). Leading the AMBUPC were American Physicians Capital (+4.01%) and Unico American Corp. (+3.53%). Trailing the AMBUPC were XL Capital (-8.55%) and Fidelity National Financial (-4.13%).

The U.S. Multi-Line Insurance Index (AMBUML) closed at 559.53 (+2.17%). Leading the AMBUML were AIG (+5.82%) and American National Insurance (+0.99%). Trailing the AMBUML were Assurant (-2.97%) and Atlantic American Corp. (-1.94%).

The U.S. Life Insurance Index (AMBUL) closed at 1163.24 (-0.42%). Leading the AMBUL were Presidential Life Corp. (+0.91%) and Genworth Financial (+0.86%). Trailing the AMBUL were Independence Holding Co. (-4.40%) and Principal Financial Group (-3.30%).

The U.S. Life and Health/HMO Insurance Index (AMBULH) closed at 1027.50 (-0.78%). Leading the AMBULH were Triple-S Management Corp. (+2.76%) and Presidential Life Corp. (+0.91%). Trailing the AMBULH were Penn Treaty American (-4.86%) and Independence Holding Co. (-4.40%).

The U.S. Health and HMO Index (AMBUH) closed at 881.30 (-1.29%). Leading the AMBUH were Triple-S Management Corp. (+2.76%) and Universal American (0.00%). Trailing the AMBUH were Penn Treaty American (-4.86%) and Coventry Health Care (-2.58%).

The U.S. Insurance Brokers Index (AMBUB) closed at 1007.17 (-2.41%). Leading the AMBUB were Willis Group Holdings (-1.10%) and Aon (-1.92%). Trailing the AMBUB were Brown & Brown (-3.49%) and Marsh & McLennan Cos. (-3.10%).

Performance rankings of companies in each A.M. Best insurance sector index are published weekly in BestWeek.

The A.M. Best stock indexes cover 178 publicly traded insurance companies and brokers. Index values are calculated by Dow Jones Indexes in U.S. dollars. Companies in the A.M. Best stock indexes include insurers and insurance-related organizations with credit ratings from A.M. Best, along with brokers. A.M. Best does not provide investment recommendations. A listing of companies in each A.M. Best Index is available at http://www.ambest.com/stocks.