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Aon Reports Fourth Quarter and Full Year 2009 Results

02/05/2010

Fourth Quarter Highlights
- Total revenue increased 9% to $2.1 billion with a decline in organic revenue of 2%
- EPS from continuing operations was $0.49 and adjusted EPS from continuing operations, excluding certain items, increased 20% to $0.96
- Brokerage revenue increased 8% to $1.7 billion with a decline in organic revenue of 1%
- Brokerage pretax margin was 11.5% and the adjusted pretax margin, excluding certain items, increased 160 basis points to 21.4%
- Consulting revenue increased 2% to $350 million with a decline in organic revenue of 4%
- Consulting pretax margin was 17.4% and the adjusted pretax margin, excluding certain items, increased 240 basis points to 21.4%
- Repurchased 8.6 million shares of common stock for $340 million
- Increased estimated annualized savings for the 2007 restructuring program by $69 million to $536 million, and costs necessary to achieve savings by $50 million to $750 million
- Completed acquisitions of Allied North America and FCC Global Insurance Services in construction and Carpenter Moore Insurance Services in professional liability

CHICAGO, Feb 05, 2010 /PRNewswire via COMTEX/ -- Aon Corporation (NYSE: AON) today reported results for the fourth quarter and full year ended December 31, 2009.

Net income attributable to Aon stockholders was $198 million or $0.69 per share, compared to a loss of $6 million or $0.02 per share for the prior year quarter. Net income attributable to Aon stockholders from continuing operations increased 15% to $142 million or $0.49 per share, compared to $123 million or $0.42 per share for the prior year quarter. Net income attributable to Aon stockholders from continuing operations per share, excluding certain items, increased 20% to $0.96 compared to $0.80 for the prior year quarter. Certain items that impacted fourth quarter results and comparisons with the prior year quarter are detailed in the reconciliation of non-GAAP measures on page 12 of this press release.

"Our fourth quarter results reflect solid operational performance across both Brokerage and Consulting. On an adjusted basis, total pretax margin increased 190 basis points and EPS from continuing operations increased 20 percent, despite difficult economic conditions and a 63 percent decline in investment income. Colleagues globally have done an outstanding job supporting our clients in a very challenging year, and we begin 2010 in a position of strength in the industry," said Greg Case, president and chief executive officer. "Recent investments across our organization in construction, professional liability, claims consulting and key talent continue to strengthen our client-serving capability, while our restructuring programs continue to deliver additional cost savings and margin improvement. With the achievement of a 20% adjusted pretax margin in Brokerage for 2009, we are establishing a new long-term pretax margin target of 25% for the Brokerage segment. Finally, our balance sheet and strong cash flow provide significant financial flexibility to create shareholder value, as highlighted by the repurchase of an additional $340 million of stock during the quarter, and the authorization of a new two billion dollar share repurchase program subsequent to the close of 2009."

FOURTH QUARTER FINANCIAL SUMMARY

Totalrevenue increased 9% to $2.1 billion due to a 6% increase from foreign currency translation and a 5% increase from acquisitions, primarily Benfield, net of dispositions, partially offset by a $24 million or 63% decline in investment income.

Total operating expenses increased 10% or $162 million to $1.8 billion due primarily to an estimated $96 million unfavorable impact from foreign currency translation, an $88 million increase in restructuring related expenses and the inclusion of Benfield operating expenses, partially offset by benefits related to the 2007 and Aon Benfield restructuring programs and lower errors and omissions expense resulting from insurance recoveries.

Restructuring expenses were $175 million in the fourth quarter compared to $87 million in the prior year quarter. An analysis of restructuring-related expenses by segment and type for both the 2007 and Aon Benfield restructuring programs are detailed on page 13 of this release.

Restructuring savings in the fourth quarter related to the 2007 restructuring program are estimated at $108 million compared to $32 million in the prior year quarter. Of the estimated restructuring savings in the fourth quarter, $90 million were related to the Brokerage segment primarily from workforce reduction. Before any potential reinvestment of savings, the 2007 restructuring program delivered $269 million of cumulative cost savings in 2009, and is now expected to deliver $536 million of annualized run-rate cost savings by the end of 2010, primarily as a result of additional cost savings opportunities to streamline support functions globally.

Restructuring savings in the fourth quarter related to the Aon Benfield restructuring program are estimated at $17 million. Before any potential reinvestment of savings, the Benfield restructuring program delivered $45 million of cumulative cost savings in 2009, and is expected to deliver cumulative cost savings of $90-100 million in 2010 and $122 million in 2011.

Currency fluctuations in the fourth quarter favorably impacted adjusted net income from continuing operations by $0.05 per diluted share when the Company translates prior year quarter results at current quarter foreign exchange rates.

Effective tax rate on net income from continuing operations decreased to 25.4% for the fourth quarter compared to 28.2% for the prior year quarter due primarily to changes in the geographical distribution of income. The company anticipates an effective tax rate on net income from continuing operations of 28.0% for 2010.

Average diluted shares outstanding decreased to 287.8 million in the fourth quarter compared to 291.4 million in the prior year quarter due primarily to the Company's share repurchase program. During the quarter, the Company repurchased 8.6 million shares of common stock for $340 million. The company has approximately $265 million remaining under the existing share repurchase program previously authorized in 2005.

Discontinued Operations after-tax income was $56 million or $0.20 per share in the fourth quarter compared to an after-tax loss of $129 million or $0.44 per share in the prior year quarter. The fourth quarter primarily reflects the recognition of a foreign tax credit carryback related to the completed sale of Combined Insurance Companies of America (CICA). The prior year quarter included an estimated $116 million loss on disposal of the property and casualty insurance operations and the results of Automobile Insurance Specialists (AIS).

FOURTH QUARTER SEGMENT REVIEW

Certain noteworthy items impacted pretax income and pretax margins in the fourth quarter of 2009 and 2008. The fourth quarter segment reviews provided below include supplemental information related to organic revenue growth, adjusted pretax income and pretax margin which is described in detail on the "Reconciliation of Non-GAAP Measures - Organic Revenue Growth" on page 11 and "Reconciliation of Non-GAAP Measures - Segments and Diluted Earnings Per Share" on page 12 of this press release.

    RISK AND INSURANCE BROKERAGE SERVICES
    -------------------------------------

                                                              Less:
                                                              Acquis-
    (millions)         Fourth Quarter Ended           Less:   itions,
                       --------------------           Curr-   Divest-  Organic
    Commissions,       Dec 31,      Dec 31,      %    ency    itures,  Revenue
    Fees and Other      2009         2008     Change  Impact  Other    Growth
                       ------       ------    ------  ------  ------   ------
    Retail             $1,347       $1,285        5%      7%     (1)%    (1)%
    Reinsurance           339          247       37       4      35      (2)
                       ------       ------
    Subtotal           $1,686       $1,532       10%      6       5      (1)
                       ------       ------
    Investment Income      14           37      (62)%
                       ------       ------
    Total Revenue      $1,700       $1,569        8%
                       ======       ======



Risk and Insurance Brokerage Services total revenue increased 8% to $1.7 billion compared to the prior year quarter due to a 6% favorable impact from foreign currency translation on commissions and fees and a 5% increase from acquisitions, primarily Benfield, net of dispositions, partially offset by a $23 million or 62% decline in investment income.

Retail organic revenue declined 1% compared to the prior year quarter. By geographic region in Retail, the Americas organic revenue was similar to the prior year quarter as strong growth in Latin America and strong new business growth in U.S. retail was offset by the impact of soft pricing and lower exposure units on renewal business in Canada and U.S. retail. U.K. organic revenue decreased 9% due primarily to weak economic conditions, soft pricing and lower new business. EMEA organic revenue increased 2% due to strong growth in emerging markets, partially offset by weak economic conditions in Continental Europe. APAC organic revenue was similar to the prior year reflecting strong growth in emerging markets partially offset by soft market conditions in Australia. Reinsurance organic revenue decreased 2% due primarily to higher cedent retentions in treaty business, partially offset by new business growth in treaty placements globally, facultative and capital markets transactions.

                                     Fourth Quarter Ended
                                     --------------------
    (millions)                       Dec 31,      Dec 31,       %
                                      2009          2008     Change
                                     ------        ------    ------
    Revenue                          $1,700        $1,569        8%
    Expenses
        Compensation and benefits     1,099           934       18
        Other expenses                  407           425       (4)
                                     ------        ------
       Total operating expenses       1,506         1,359       11
                                     ------        ------
                                       $194          $210       (8)%
       Operating income
        Other income (expense)            2             3      (33)
                                       ----          ----

    Pretax  income                     $196          $213       (8)%
                                       ====          ====
    Pretax  margin                     11.5%         13.6%

    Pretax income - adjusted           $363          $310       17%
    Pretax margin - adjusted           21.4%         19.8%



Compensation and benefits for the fourth quarter increased 18% or $165 million compared to the prior year quarter including an $88 million increase in restructuring related costs, a $54 million unfavorable impact from foreign currency translation and increased operating expenses from the Benfield merger, partially offset by benefits related to the restructuring programs. Other operating expenses for the fourth quarter decreased 4% or $18 million from the prior year quarter due primarily to lower errors and omissions expense resulting from insurance recoveries and benefits related to the restructuring programs, partially offset by a $25 million unfavorable impact from foreign currency translation and the inclusion of Benfield operating expenses.

Fourth quarter pretax income decreased 8% to $196 million. Adjusting for certain items detailed on page 12 of this press release, pretax income increased 17% or $53 million to $363 million and pretax margin increased 160 basis points to 21.4% versus the prior year quarter due primarily to benefits of the restructuring programs and lower errors and omissions expense, partially offset by a $23 million decrease in investment income.

    CONSULTING
    ----------
                                                           Less:
                                                           Acquis-
    (millions)    Fourth Quarter Ended            Less:    itions,
                  --------------------            Curr-    Divest-  Organic
    Commissions,   Dec 31,     Dec 31,     %      ency     itures,  Revenue
    Fees and Other   2009       2008     Change   Impact   Other    Growth
                  --------     -------   -------  -------  -------  -------
    Services          $299       $289        3%        5%       2%     (4)%
    Outsourcing         51         52       (2)        3       (3)     (2)
                       ---        ---
    Subtotal          $350       $341        3%        5%       2%     (4)%
                       ---        ---
    Investment
     Income              -          1     (100)%
                       ---        ---
    Total Revenue     $350       $342        2%
                      ====       ====



Compensation and benefits for the fourth quarter increased 3% or $7 million from the prior year quarter including a $10 million unfavorable impact from foreign currency translation and a $4 million increase in restructuring related costs, partially offset by benefits related to the 2007 restructuring program. Other operating expenses decreased 4% or $3 million compared to the prior year quarter due to benefits related to the 2007 restructuring program and lower errors and omissions expense resulting from insurance recoveries, partially offset by a $6 million unfavorable impact from foreign currency translation.

Fourth quarter pretax income increased 11% to $61 million. Adjusting for certain items detailed on page 12 of this press release, pretax income increased 15% or $10 million to $75 million and pretax margin increased 240 basis points to 21.4% versus the prior year quarter due primarily to benefits related to the 2007 restructuring program and lower errors and omissions expense, partially offset by a decline in organic revenue.

    UNALLOCATED INCOME AND EXPENSE
    ------------------------------
                                         Fourth Quarter Ended
                                         ----------------------
    (millions)                           Dec 31,         Dec 31,      %
                                           2009            2008    Change
                                         ------          ------    ------
    Total segment income before tax        $257            $268       (4)%
    Unallocated revenue                      29                      N/A
    Unallocated expenses                    (43)            (74)     (42)
    Interest income                          10              13      (23)
    Interest expense                        (35)            (30)      17
                                            ---             ---
    Income from continuing operations
     before tax                            $218            $177       23%
                                           ====            ====



Unallocated revenue for the fourth quarter was $29 million reflecting the Company's equity ownership in certain insurance investment funds. Unallocated expenses decreased $31 million to $43 million. The fourth quarter included $5 million of expense related to the Company's equity ownership in certain insurance investment funds. The prior year quarter included $44 million of hedging costs related to the Benfield transaction. Interest income decreased $3 million to $10 million compared to the prior year quarter due primarily to lower cash balances. Interest expense increased $5 million to $35 million due to an increase in the average rate on outstanding debt.

2009 FULL YEAR SUMMARY

Total revenue for 2009 increased 1% to $7.6 billion due to a 7% increase from acquisitions, primarily Benfield, net of dispositions, primarily offset by a 4% unfavorable impact from foreign currency translation and a $97 million or 57% decline in investment income. Risk and Insurance Brokerage Services total revenue increased 2% to $6.3 billion and Consulting total revenue decreased 7% to $1.3 billion.

Net income attributable to Aon stockholders for 2009 decreased 49% to $747 million compared to $1.5 billion for the prior year. The prior year included a $935 million after-tax gain on the sales of Combined Insurance Companies of America (CICA) and Sterling Life Insurance (Sterling). Net income attributable to Aon stockholders from continuing operations increased 2% to $636 million compared to $621 million for the prior year. Net income attributable to Aon stockholders, excluding certain items, increased 4% to $906 million compared to $874 million for the prior year. Certain items that impacted full year results and comparisons against the prior year are detailed in the reconciliations of the impact of non-GAAP measures on page 12.

Net income attributable to Aon stockholders for 2009 decreased 46% to $2.57 per share compared to $4.80 per share for the prior year. Net income attributable to Aon stockholders from continuing operations increased 7% to $2.19 per share compared to $2.04 per share for the prior year. Net income attributable to Aon stockholders, excluding certain items, increased 8% to $3.11 per share compared to $2.87 per share for the prior year. Certain items that impacted full year results and comparisons against the prior year are detailed in the reconciliations of the impact of non-GAAP measures on page 12.

During 2009, the Company repurchased approximately 15.1 million shares of common stock for $590 million at an average price of $39.17 per share.

SUBSEQUENT EVENTS

In January 2010, the Board of Directors authorized a new share repurchase program under which up to $2 billion of common stock may be repurchased from time to time depending on market conditions or other factors through open market or privately negotiated transactions. Repurchases will commence under the new share repurchase program upon conclusion of the existing program.

Conference Call and Webcast Details

The Company will host a conference call on Friday, February 5, 2010 at 7:30 a.m. central time. Interested parties can listen to the conference call via a live audio webcast at www.aon.com.

About Aon

Aon Corporation (NYSE: AON) is the leading global provider of risk management services, insurance and reinsurance brokerage, and human capital consulting. Through its more than 36,000 colleagues worldwide, Aon readily delivers distinctive client value via innovative and effective risk management and workforce productivity solutions. Aon's industry-leading global resources and technical expertise are delivered locally through more than 500 offices in more than 120 countries. Named the world's best broker by Euromoney magazine's 2008 and 2009 Insurance Survey, Aon also ranked highest on Business Insurance's listing of the world's largest insurance brokers based on commercial retail, wholesale, reinsurance and personal lines brokerage revenues in 2008 and 2009. A.M. Best deemed Aon the number one insurance broker based on brokerage revenues in 2007, 2008, and 2009, and Aon was voted best insurance intermediary, best reinsurance intermediary and best employee benefits consulting firm in 2007, 2008 and 2009 by the readers of Business Insurance. For more information on Aon, log onto http://www.aon.com .

Safe Harbor Statement

This press release contains certain statements related to future results, or states our intentions, beliefs and expectations or predictions for the future 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: general economic conditions in different countries in which we do business around the world, changes in global equity and fixed income markets that could affect the return on invested assets, fluctuations in exchange and interest rates that could influence revenue and expense, rating agency actions that could affect our ability to borrow funds, funding of our various pension plans, changes in the competitive environment, our ability to implement restructuring initiatives and other initiatives intended to yield cost savings, changes in commercial property and casualty markets and commercial premium rates that could impact revenues, the outcome of inquiries from regulators and investigations related to compliance with the U.S. Foreign Corrupt Practices Act and non-U.S. anti-corruption laws, the impact of investigations brought by U.S. state attorneys general, U.S. state insurance regulators, U.S. federal prosecutors, U.S. federal regulators, and regulatory authorities in the U.K. and other countries, the impact of class actions and individual lawsuits including client class actions, securities class actions, derivative actions, ERISA class actions, the cost of resolution of other contingent liabilities and loss contingencies, and our ability to integrate Benfield successfully and to realize the anticipated benefits of the Benfield merger. 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.

Explanation of Non-GAAP Measures

This press release includes supplemental information related to organic revenue growth and several additional measures including expenses, margins and income per share, that exclude the effects of restructuring charges and certain other noteworthy items that affected results for the comparable periods. Organic revenue growth excludes from reported revenues the impact of foreign exchange, acquisitions, divestitures, transfers between business units, investment income, reimbursable expenses and unusual items. The impact of foreign exchange is determined by translating last year's revenue, expense or net income at this year's foreign exchange rates. Reconciliation is provided in the attached schedules. Supplemental organic revenue growth information and additional measures that exclude the effects of the restructuring charges and certain other items do not affect net income or any other GAAP reported amounts. Management believes that these measures are important to make meaningful period-to-period comparisons and that this supplemental information is helpful to investors. They should be viewed in addition to, not in lieu of, the Company's Consolidated Statements of Income. Industry peers provide similar supplemental information regarding their performance, although they may not make identical adjustments.

    Investor Contact:                 Media Contact:
    Scott Malchow                     David Prosperi
    Vice President,                   Vice President,
    Investor Relations                Global Public Relations
    312-381-3983                      312-381-2485


    Aon Corporation
    Consolidated Statements of Income (Unaudited)

                           Fourth Quarter Ended      Twelve Months Ended
                        -------------------------  -------------------------
    (millions except    Dec. 31, Dec. 31, Percent  Dec. 31, Dec. 31, Percent
     per share data)      2009     2008    Change    2009     2008    Change
                        -------- -------- -------  -------- -------- -------
    Revenue
    -------
      Commissions, fees
       and other          $2,059   $1,868    10%      $7,521   $7,357      2%
      Investment income       14       38   (63)          74      171    (57)
                             ---      ---                ---      ---
        Total
         revenue           2,073    1,906     9        7,595    7,528      1
                           -----    -----              -----    -----

    Expenses
    --------
      Compensation and
       benefits            1,330    1,153    15        4,597    4,581      -
      Other general
       expenses              434      452    (4)       1,735    1,785     (3)
      Depreciation
       and
       amortization           68       65     5          242      222      9
                             ---      ---                ---      ---
        Total
         operating
         expenses          1,832    1,670    10        6,574    6,588      -
                           -----    -----              -----    -----
    Operating income         241      236     2        1,021      940      9

      Interest income         10       13   (23)          30       94    (68)
      Interest expense       (35)     (30)   17         (122)    (126)    (3)
      Other income
       (expense)               2      (42)  N/A           20      (29)   N/A
                             ---      ---                ---      ---
    Income from
     continuing
     operations
     before income
     taxes                   218      177    23          949      879      8
      Income taxes (1)        56       50    12          268      242     11
                             ---      ---                ---      ---
    Income from
     continuing
     operations              162      127    28          681      637      7
                             ---      ---                ---      ---

    Income (loss)
     from
     discontinued
     operations
     before income
     taxes                   (10)    (184)  (95)          83    1,256    (93)
      Income taxes (2)       (66)     (55)   20          (28)     415    N/A
                             ---      ---                ---      ---
    Income (loss) from
     discontinued
     operations               56     (129)  N/A          111      841    (87)
                             ---     ----                ---      ---

      Net income
      (loss)                 218       (2)  N/A          792    1,478    (46)
      Less:  Net
       income
       attributable to
       the
       noncontrolling
       interests              20        4   400           45       16    181
                             ---      ---                ---      ---
    Net income
     (loss)
     attributable
     to Aon
     stockholders           $198      $(6)  N/A%        $747   $1,462    (49)%
                            ====      ===               ====   ======

    Net income (loss)
     attributable to Aon
     stockholders:
      Income from
       continuing
       operations           $142     $123    15%        $636     $621      2%
      Income (loss) from
       discontinued
       operations             56     (129)  N/A          111      841    (87)
                             ---     ----                ---      ---
      Net income (loss)     $198      $(6)  N/A%        $747   $1,462    (49)%
                            ====      ===               ====   ======
    Basic net income
     (loss) per share
     attributable to
     Aon stockholders
     (3):
      Income from
       continuing
       operations          $0.51    $0.44    16%       $2.25    $2.12      6%
      Income (loss) from
       discontinued
       operations           0.20    (0.46)  N/A         0.39     2.87    (86)
                            ----    -----               ----     ----
      Net income (loss)    $0.71   $(0.02)  N/A%       $2.64    $4.99    (47)%
                           =====   ======              =====    =====

    Diluted net income
     (loss) per share
     attributable to
     Aon stockholders
     (3):
      Income from
       continuing
       operations          $0.49    $0.42    17%       $2.19    $2.04      7%
      Income (loss) from
       discontinued
       operations           0.20    (0.44)  N/A         0.38     2.76    (86)
                            ----    -----               ----     ----
      Net income (loss)    $0.69   $(0.02)  N/A%       $2.57    $4.80    (46)%
                           =====   ======              =====    =====

    Weighted
     average common
     shares
     outstanding -
     diluted               287.8    291.4    (1)%      291.1    304.5     (4)%
                           =====    =====              =====    =====



    (1)  Tax rate for continuing operations is 25.4% and 28.2% for the fourth
         quarters ended December 31, 2009 and 2008, respectively, and 28.2%
         and 27.5% for the twelve months ended December 31, 2009 and 2008,
         respectively.

    (2)  Tax rate for discontinued operations is not meaningful for the
         fourth quarter and twelve months ended December 31, 2009. The tax
         rate for discontinued operations was 29.9% and 33.0% for the fourth
         quarter and twelve months ended December 31, 2008, respectively.

    (3)  The basic and diluted earnings per share calculation was performed
         using the two-class method and included the impact of certain
         unvested share-based payment awards that have the right to receive
         nonforfeitable dividends.




    Aon Corporation
    Revenue from Continuing Operations (Unaudited)

                     Fourth Quarter Ended          Twelve Months Ended
                   ----------------------------  ---------------------------
                                         Orga-                        Orga-
                                         nic                          nic
                                         Reve-                        Reve-
                   Dec.     Dec. Per-    nue     Dec.    Dec.  Per-   nue
                   31,      31,  cent    Growth  31,     31,   cent   Growth
    (millions)     2009     2008 Change  (1)     2009    2008  Change (1)
                   ----     ---- ------- -----   ----    ----   ----- -----
    Commissions,
     Fees and
     Other
    ----------
    Risk and
     Insurance
     Brokerage
     Services     $1,686   $1,532   10%  (1)%   $6,232   $6,029    3%  (1)%
    Consulting       350      341    3   (4)     1,266    1,353   (6)  (2)
                     ---      ---                -----    -----
      Total
       Operating
       Segments   $2,036   $1,873    9%  (2)%   $7,498   $7,382    2%  (1)%
                  ======   ======               ======   ======

    Investment
     Income
    ----------
    Risk and
     Insurance
     Brokerage
     Services        $14      $37  (62)%           $73     $168  (57)%
    Consulting         -        1 (100)              1        3  (67)
                     ---      ---                -----    -----
      Total
       Operating
       Segments      $14      $38  (63)%           $74     $171  (57)%
                     ===      ===                  ===     ====

    Total Revenue
    -------------
    Risk and
     Insurance
     Brokerage
     Services     $1,700   $1,569    8%         $6,305   $6,197    2%
    Consulting       350      342    2           1,267    1,356   (7)
    Unallocated       29        -  N/A              49        -  N/A
    Intersegment      (6)      (5)  20             (26)     (25)   4
                     ---      ---                  ---      ---
      Total       $2,073   $1,906    9%         $7,595   $7,528    1%
                  ======   ======               ======   ======



    (1)  Organic revenue growth excludes the impact of foreign exchange,
         acquisitions, divestitures, transfers, reimbursable expenses and
         unusual items. Organic revenue growth, a non-GAAP measure, is
         reconciled to the corresponding U.S. GAAP percent change in revenue
         on page 11 of this release.




    Aon Corporation
    Segments (Unaudited)
    Risk and Insurance
     Brokerage Services  -
     Continuing Operations  Fourth Quarter Ended      Twelve Months Ended
     ---------------------- ----------------------    ----------------------
                            Dec.    Dec.    Per-      Dec.    Dec.    Per-
                            31,     31,     cent      31,     31,     cent
    (millions)              2009    2008    Change    2009    2008    Change
                            -----   -----   ------    -----   -----   ------
    Revenue
    -------
      Commissions, fees
       and other           $1,686  $1,532       10%  $6,232  $6,029        3%
      Investment income        14      37      (62)      73     168      (57)
                              ---     ---               ---     ---
        Total revenue       1,700   1,569        8    6,305   6,197        2
                            -----   -----             -----   -----

    Expenses
    --------
      Compensation and
       benefits             1,099     934       18    3,777   3,707        2
      Other general
       expenses               407     425       (4)   1,628   1,644       (1)
                              ---     ---             -----   -----
        Total operating
         expenses           1,506   1,359       11    5,405   5,351        1
                            -----   -----             -----   -----

    Operating income          194     210       (8)     900     846        6
      Other income
       (expense)                2       3      (33)      14      21      (33)
                              ---     ---               ---     ---
    Segment income before
     income taxes            $196    $213       (8)%   $914    $867        5%
                             ====    ====              ====    ====

    Segment pretax income
     margin                  11.5%   13.6%             14.5%   14.0%

    Consulting -
     Continuing Operations  Fourth Quarter Ended      Twelve Months Ended
    ----------------------  ----------------------    ----------------------
                            Dec.    Dec.    Per-      Dec.    Dec.    Per-
                            31,     31,     cent      31,     31,     cent
    (millions)              2009    2008    Change    2009    2008    Change
                            -----   -----   ------    -----   -----   ------
    Revenue
    -------
      Commissions, fees
       and other             $350    $341        3%  $1,266  $1,353       (6)%
      Investment income         -       1     (100)       1       3      (67)
                              ---     ---               ---     ---
        Total revenue         350     342        2    1,267   1,356       (7)
                              ---     ---             -----   -----

    Expenses
    --------
      Compensation and
       benefits               210     203        3      754     815       (7)
      Other general
       expenses                81      84       (4)     310     333       (7)
                              ---     ---               ---     ---
        Total operating
         expenses             291     287        1    1,064   1,148       (7)
                              ---     ---             -----   -----

    Operating income           59      55        7      203     208       (2)
      Other income
       (expense)                2       -     N/A         2       1      100
                              ---     ---               ---     ---
    Segment income before
     income taxes             $61     $55       11%    $205    $209       (2)%
                              ===     ===              ====    ====

    Segment pretax income
     margin                  17.4%   16.1%             16.2%   15.4%

    Reconciliation of segment income
     before income taxes to income
     from continuing operations
     before income taxes:
                            Fourth Quarter Ended      Twelve Months Ended
                            ----------------------    ----------------------
                            Dec.    Dec.    Per-      Dec.    Dec.    Per-
                            31,     31,     cent      31,     31,     cent
    (millions)              2009    2008    Change    2009    2008    Change
                            -----   -----   ------    -----   ----    ------
    Segment income before
     income taxes
      Risk and Insurance
       Brokerage Services    $196    $213       (8)%   $914    $867        5%
      Consulting               61      55       11      205     209       (2)
                              ---     ---               ---     ---
           Total segment
            income before
            income
            taxes             257     268       (4)   1,119   1,076        4
    Unallocated revenue        29       -      N/A       49       -      N/A
    Unallocated expenses      (43)    (74)     (42)    (127)   (165)     (23)
    Interest income            10      13      (23)      30      94      (68)
    Interest expense          (35)    (30)      17     (122)   (126)      (3)
                              ---     ---              ----    ----
    Income from
     continuing operations
     before income taxes     $218    $177       23%    $949    $879        8%
                             ====    ====              ====    ====

    Pretax income margin     10.5%    9.3%             12.5%   11.7%





    Aon Corporation
    Reconciliation of Non-GAAP Measures - Organic Revenue Growth (Unaudited)

                                         Fourth Quarter Ended
                            --------------------------------------------------
                                                              Less:
                                                              Acquis-   Org-
                                                    Less:     itions,   anic
                                                    Curr-     Dives-    Reve-
                            Dec.   Dec.   Per-      ency      titures   nue
                            31,    31,    cent      Impact    &         Growth
    (millions)              2009   2008   Change    (1)       Other     (2)
                            ----   -----  ------    -------   --------  ------
    Commissions, Fees
     and Other
    -----------------
    Risk and Insurance
     Brokerage Services
     Segment:
      Retail
       brokerage
        Americas             $657   $642     2%       3%       (1)%       -%
        United
         Kingdom              186    196    (5)       3         1        (9)
        Europe,
         Middle East
         & Africa             366    329    11       11        (2)        2
        Asia Pacific          138    118    17       21        (4)        -
                              ---    ---
           Total Retail
            brokerage       1,347  1,285     5        7        (1)       (1)
      Reinsurance
       brokerage              339    247    37        4        35        (2)
                              ---    ---
             Total Risk and
              Insurance
              Brokerage
              Services      1,686  1,532    10        6         5        (1)
                            -----  -----
    Consulting
     Segment:
        Consulting
         services             299    289     3        5         2        (4)
        Outsourcing            51     52    (2)       3        (3)       (2)
                              ---    ---
            Total
             Consulting       350    341     3        5         2        (4)
                              ---    ---
    Total Operating
     Segments              $2,036 $1,873     9%       6%        5%       (2)%
                           ====== ======


                                         Twelve Months Ended
                            --------------------------------------------------
                                                             Less:
                                                             Acqui-    Org-
                                                    Less:    sitions,  anic
                                                    Curr-    Dives-    Reve-
                            Dec.   Dec.   Per-      ency     titures   nue
                            31,    31,    cent      Impact   &         Growth
    (millions)              2009   2008   Change    (1)      Other     (2)
                            -----  -----  ------    -------  --------  -------
    Commissions, Fees
     and Other
    -----------------
    Risk and Insurance
     Brokerage Services
     Segment:
      Retail
       brokerage
        Americas           $2,249 $2,280    (1)%     (2)%       -%        1%
        United
         Kingdom              650    742   (12)      (9)        3        (6)
        Europe,
         Middle East
         & Africa           1,392  1,515    (8)      (7)        -        (1)
        Asia Pacific          456    491    (7)      (4)       (2)       (1)
                              ---    ---
          Total Retail
           brokerage        4,747  5,028    (6)      (5)        -        (1)
      Reinsurance
       brokerage            1,485  1,001    48       (4)       52         -
                            -----  -----
             Total Risk and
              Insurance
              Brokerage
              Services      6,232  6,029     3       (4)        8        (1)
                            -----  -----
    Consulting
     Segment:
        Consulting
         services           1,075  1,139    (6)      (5)        1        (2)
        Outsourcing           191    214   (11)      (7)        -        (4)
                              ---    ---
            Total
             Consulting     1,266  1,353    (6)      (5)        1        (2)
                            -----  -----
    Total Operating
     Segments              $7,498 $7,382     2%      (4)%       7%       (1)%
                           ====== ======


    (1)  Currency impact is determined by translating last year's revenue at
         this year's foreign exchange rates.

    (2)  Organic revenue growth excludes the impact of foreign exchange,
         acquisitions, divestitures, transfers, reimbursable expenses and
         unusual items.





    Aon Corporation
    Reconciliation of Non-GAAP Measures - Segment Income and Diluted Earnings
    Per Share (Unaudited) (1)



                  Fourth Quarter Ended          Twelve Months Ended
                  December 31, 2009             December 31, 2009
                  ----------------------------  ----------------------------
                  Risk                          Risk
                  and                           and
                  Insur-                        Insur-
                  ance           Unallo-        ance          Unallo-
    (millions     Broke-         cated          Broke-        cated
     except       rage           and            rage          and
     per          Serv-  Consu-  Elimin-        Serv-  Consu- Elimin-
     share data)  ices   lting   ations   Total ices   lting  ations  Total
                  ------ ------  -------  ----- ------ ------ ------- ------
    Revenue       $1,700   $350      $23 $2,073 $6,305 $1,267    $23 $7,595
                  ======   ====      === ====== ====== ======    === ======

    Income
     (loss)
     from
     continuing
     operations
     before
     income
     taxes -
     as
     reported      $196    $61     $(39)  $218   $914   $205   $(170)  $949
      Restructuring
       charges      161     14        -    175    377     35       -    412
      Pension
       curtailment    -      -        -      -    (54)   (20)     (4)   (78)
      Anti-bribery
       and
       compliance
       initiatives    4      -        -      4      7      -       -      7
      Benfield
       integration
       costs          2      -        -      2     15      -       -     15
                    ---    ---      ---    ---    ---    ---     ---    ---
    Income
     (loss)
     from
     continuing
     operations
     before
     income
     taxes - as
     adjusted      $363    $75     $(39)   399 $1,259   $220   $(174) 1,305
                   ====    ===     ====        ======   ====   =====
    Income
     taxes
     (2)                                   103                          354
                                           ---                          ---
    Income from
     continuing
     operations
     - as
     adjusted                              296                          951
      Less:
       Net income
       attributable
       to
       noncontrolling
       interests                            20                           45
                                           ---                          ---
    Income from
     continuing
     operations
     attributable
     to Aon
     stockholders
     - as
     adjusted                             $276                         $906
                                          ====                         ====
    Diluted
     earnings
     per
     share from
     continuing
     operations
     - as
     adjusted                            $0.96                        $3.11
                                         =====                        =====

    Weighted
     average
     common
     shares
     outstanding -
     diluted                             287.8                        291.1
                                         =====                        =====

    Pretax
     income
     margins -
     as
     adjusted      21.4%  21.4%     N/A   19.2%  20.0%  17.4%    N/A   17.2%
                   ====   ====      ===   ====   ====   ====     ===   ====

                  Fourth Quarter Ended         Twelve Months Ended
                  December 31, 2008            December 31, 2008
                  ---------------------------- ----------------------------
                  Risk                         Risk
                  and                          and
                  Insur-                       Insur-
                  ance          Unallo-        ance          Unallo-
    (millions     Broke-        cated          Broke-        cated
     except       rage          and            rage          and
     per          Serv-  Consu- Elimin-        Serv-  Consu- Elimin-
     share data)  ices   lting  ations   Total ices   lting  ations  Total
                  ------ ------ -------  ----- ------ ------ ------- -----
    Revenue       $1,569   $342     $(5)$1,906 $6,197 $1,356    $(25)$7,528
                  ======   ====     === ====== ====== ======    ==== ======

    Income
     (loss)
     from
     continuing
     operations
     before
     income taxes
     - as
     reported       $213    $55    $(91)  $177   $867   $209   $(197)  $879
      Restructuring
       charges        78      9       -     87    237     17       -    254
      Pension
       curtailment     6      1       1      8      6      1       1      8
      Anti-bribery
       and
       compliance
       initiatives    11      -       -     11     42      -       -     42
      Benfield
       costs           2      -      44     46      2      -      50     52
      Gain on
       sale
       of land         -      -       -      -     (5)     -       -     (5)
                     ---    ---     ---    ---    ---    ---     ---    ---
    Income
     (loss)
     from
     continuing
     operations
     before
     income tax
     - as
     adjusted       $310    $65    $(46)   329 $1,149   $227   $(146) 1,230
                    ====    ===    ====        ======   ====   =====
    Income
     taxes (2)                              93                          340
                                           ---                          ---
    Income
     from
     continuing
     operations
     - as
     adjusted                              236                          890
      Less:  Net
       income
       attributable
       to
       noncontrolling
       interests                             4                           16
                                           ---                          ---
    Income from
     continuing
     operations
     attributable
     to Aon
     stockholders
     - as
     adjusted                             $232                         $874
                                          ====                         ====
    Diluted earnings
     per share from
     continuing
     operations
     - as
     adjusted                            $0.80                        $2.87
                                         =====                        =====

    Weighted
     average
     common shares
     outstanding -
     diluted                             291.4                        304.5
                                         =====                        =====

    Pretax
     income
     margins -
     as adjusted    19.8%  19.0%    N/A   17.3%  18.5%  16.7%    N/A   16.3%
                    ====   ====     ===   ====   ====   ====     ===   ====

    (1)  Certain noteworthy items impacting pretax income in 2009 and 2008 are
         described in this schedule.  The income (loss) from continuing
         operations before income taxes, diluted earnings per share from
         continuing operations and related margins shown with the caption
         "as adjusted" are non-GAAP measures.

    (2)  Tax rate for continuing operations is 25.4% and 28.2% for the fourth
         quarters ended December 31, 2009 and 2008, respectively, and 28.2%
         and 27.5% for the twelve months ended December 31, 2009 and 2008,
         respectively (U.S. GAAP).  All reconciling items for the twelve month
         periods are taxed at the effective tax rate.  However, the twelve
         months 2009 U.S. GAAP effective tax rate was adjusted to 27.1% to
         exclude the impact of the 40% tax rate applied to the $83 million
         U.S. pension curtailment gain.





    Aon Corporation
    Restructuring Plans (Unaudited) (1)

    2007 Restructuring Plan

    By Type:                                 Actual
                                -------------------------------
                                                       Total
                                Full Full Fourth  Full Incurred
                                Year Year Quarter Year to       Estimated
    (millions)                  2007 2008 2009    2009 Date     Total
                                ---- ---- ------- ---- -------- -----------
    Workforce reduction          $17 $166    $133 $251     $434        $510
    Lease consolidation           22   38      22   78      138         149
    Asset impairments              4   18       8   15       37          39
    Other costs associated with
     restructuring                 3   29       2   13       45          52
                                 ---  ---     ---  ---      ---         ---
    Total restructuring and
     related expenses            $46 $251    $165 $357     $654        $750
                                 === ====    ==== ====     ====        ====

    By Segment:

    Risk and Insurance
     Brokerage Services          $41 $234    $151 $322     $597        $683
    Consulting                     5   17      14   35       57          67
                                 ---  ---     ---  ---      ---         ---
    Total restructuring and
     related expenses            $46 $251    $165 $357     $654        $750
                                 === ====    ==== ====     ====        ====



    Benfield Restructuring Plan

    By Type:
                                             Operations
                                            ------------
                                Purchase
                                Price       Fourth  Full
                                Allocation  Quarter Year Estimated
    (millions)                  (2)         2009    2009 Total
                                ----------- ------- ---- ---------
    Workforce reduction                 $32      $7  $38       $98
    Lease consolidation                  22       3   14        49
    Asset impairments                     -       -    2         5
    Other costs associated with
     restructuring                        1       -    1         3
                                        ---     ---  ---       ---
    Total restructuring and
     related expenses                   $55     $10  $55      $155
                                        ===     ===  ===      ====

    (1)  In the Consolidated Statements of Income, workforce reductions are
         included in "Compensation and benefits," lease consolidations and
         other costs associated with restructuring are included in "Other
         general expenses," and asset impairments are included in
         "Depreciation and amortization."

    (2)  Represents costs associated with the execution of restructuring
         activity identified at the acquisition date (November 30, 2008).





                          Aon Corporation
      Condensed Consolidated Statements of Financial Position

                                              As of
                                  -----------------------------
     (millions)                   Dec. 31, 2009  Dec. 31, 2008
    ------------                  -------------  --------------
                                   (Unaudited)
     ASSETS
    --------
       CURRENT ASSETS
       Cash and cash equivalents           $217            $582
       Short-term investments               422             684
       Receivables                        2,052           1,990
       Fiduciary assets (1)              10,835          10,678
       Other current assets                 463             355
       Assets held for sale                   -             237
                                            ---             ---
         Total Current Assets            13,989          14,526
       Goodwill                           6,078           5,637
       Other intangible assets              791             779
       Fixed assets, net                    461             451
       Investments                          319             332
       Other non-current assets           1,320           1,215
                                          -----           -----
       TOTAL ASSETS                     $22,958         $22,940
                                        =======         =======

     LIABILITIES
    --------------
       CURRENT LIABILITIES
       Fiduciary liabilities            $10,835         $10,678
       Short-term debt                       10             105
       Accounts payable and
        accrued liabilities               1,535           1,560
       Other current liabilities            260            314
       Liabilities held for sale              -             146
                                            ---             ---
           Total Current
            Liabilities                  12,640          12,803
       Long-term debt                     1,998           1,872
       Pension and other post
        employment liabilities            1,889           1,694
       Other non-current
        liabilities                       1,000           1,156
                                            ---           -----
       TOTAL LIABILITIES                 17,527          17,525
                                         ------          ------
       TOTAL STOCKHOLDERS'
        EQUITY                            5,379           5,310
       Noncontrolling interest               52             105
                                            ---             ---
       TOTAL EQUITY                       5,431           5,415
                                          -----           -----
       TOTAL LIABILITIES AND
        EQUITY                          $22,958         $22,940
                                        =======         =======

     (1) Includes short-term investments:  2009 - $3,329,
         2008 - $3,178.





    Aon Corporation
    Consolidated Statements of Income - Reflects the reclassification of
    non-fiduciary investment income and other items (unaudited)


                                                      2007
                                   ------------------------------------------
    (millions except per share       1st      2nd      3rd      4th     Full
     data)                         Quarter  Quarter  Quarter  Quarter   Year
                                   -------  -------  -------  -------   -----
    Revenue
    -------
      Commissions, fees and other   $1,701   $1,747   $1,666   $1,940  $7,054
      Investment income                 42       45       49       44     180
                                       ---      ---      ---      ---     ---
        Total revenue                1,743    1,792    1,715    1,984   7,234
                                     -----    -----    -----    -----   -----

    Expenses
    --------
      Compensation and benefits      1,040    1,097    1,047    1,157   4,341
      Other general expenses           409      410      387      491   1,697
      Depreciation and
       amortization                     47       46       48       52     193
                                       ---      ---      ---      ---     ---
        Total operating expenses     1,496    1,553    1,482    1,700   6,231
                                     -----    -----    -----    -----   -----
    Operating income                   247      239      233      284   1,003

      Interest income                   25       31       25       19     100
      Interest expense                 (35)     (34)     (33)     (36)   (138)
      Other income (expense)             1       44        6        7      58
                                       ---      ---      ---      ---     ---
    Income from continuing
     operations before income
     taxes                             238      280      231      274   1,023
      Income taxes                      73       97       95       83     348
                                       ---      ---      ---      ---     ---
    Income from continuing
     operations                        165      183      136      191     675
                                       ---      ---      ---      ---     ---

    Income (loss) from
     discontinued operations
     before income taxes                79       91       83       77     330
      Income taxes                      27       31       12       58     128
                                       ---      ---      ---      ---     ---
    Income (loss) from
     discontinued operations            52       60       71       19     202
                                       ---      ---      ---      ---     ---

    Net income (loss)                  217      243      207      210     877
      Less:  Net income
       attributable to the
       noncontrolling interests          4        3        3        3      13
                                       ---      ---      ---      ---     ---
    Net income (loss)
     attributable to Aon
     stockholders                     $213     $240     $204     $207    $864
                                      ====     ====     ====     ====    ====

    Net income (loss) attributable
     to Aon stockholders:
      Income from continuing
       operations                     $161     $180     $133     $188    $662
      Income (loss) from
       discontinued operations          52       60       71       19     202
                                       ---      ---      ---      ---     ---
      Net income (loss)               $213     $240     $204     $207    $864
                                      ====     ====     ====     ====    ====

    Basic net income (loss)
     per share attributable to
     Aon stockholders (1):
      Income from continuing
       operations                    $0.53    $0.60    $0.44    $0.61   $2.18
      Income (loss) from
       discontinued operations        0.17     0.19     0.23     0.06    0.66
                                      ----     ----     ----     ----    ----
      Net income (loss)              $0.70    $0.79    $0.67    $0.67   $2.84
                                     =====    =====    =====    =====   =====

    Dilutive net income (loss)
     per share attributable to
     Aon stockholders (1):
      Income from continuing
       operations                    $0.49    $0.56    $0.41    $0.57   $2.04
      Income (loss) from
       discontinued operations        0.16     0.18     0.22     0.06    0.62
                                      ----     ----     ----     ----    ----
      Net income (loss)              $0.65    $0.74    $0.63    $0.63   $2.66
                                     =====    =====    =====    =====   =====

    Weighted average common
     shares outstanding - diluted    328.2    326.2    325.6    327.7   326.9
                                     =====    =====    =====    =====   =====



                                                      2008
                                   ------------------------------------------
    (millions except per share       1st      2nd      3rd      4th     Full
     data)                         Quarter  Quarter  Quarter  Quarter   Year
                                   -------  -------  -------  -------   -----
    Revenue
    -------
      Commissions, fees and other   $1,848   $1,887   $1,754   $1,868  $7,357
      Investment income                 45       44       44       38     171
                                       ---      ---      ---      ---     ---
        Total revenue                1,893    1,931    1,798    1,906   7,528
                                     -----    -----    -----    -----   -----

    Expenses
    --------
      Compensation and benefits      1,154    1,143    1,131    1,153   4,581
      Other general expenses           414      500      419      452   1,785
      Depreciation and
       amortization                     50       58       49       65     222
                                       ---      ---      ---      ---     ---
        Total operating expenses     1,618    1,701    1,599    1,670   6,588
                                     -----    -----    -----    -----   -----
    Operating income                   275      230      199      236     940

      Interest income                   12       23       46       13      94
      Interest expense                 (33)     (31)     (32)     (30)   (126)
      Other income (expense)             4        4        5      (42)    (29)
                                       ---      ---      ---      ---     ---
    Income from continuing
     operations before income
     taxes                             258      226      218      177     879
      Income taxes                      76       57       59       50     242
                                       ---      ---      ---      ---     ---
    Income from continuing
     operations                        182      169      159      127     637
                                       ---      ---      ---      ---     ---

    Income (loss) from
     discontinued operations
     before income taxes                66    1,431      (57)    (184)  1,256
      Income taxes                      25      464      (19)     (55)    415
                                       ---      ---      ---      ---     ---
    Income (loss) from
     discontinued operations            41      967      (38)    (129)    841
                                       ---      ---      ---      ---     ---

    Net income (loss)                  223    1,136      121       (2)  1,478
      Less:  Net income
       attributable to the
       noncontrolling interests          5        3        4        4      16
                                       ---      ---      ---      ---     ---
    Net income (loss)
     attributable to Aon
     stockholders                     $218   $1,133     $117      $(6) $1,462
                                      ====   ======     ====      ===  ======

    Net income (loss) attributable
     to Aon stockholders:
      Income from continuing
       operations                     $177     $166     $155     $123    $621
      Income (loss) from
       discontinued operations          41      967      (38)    (129)    841
                                       ---      ---      ---     ----     ---
      Net income (loss)               $218   $1,133     $117      $(6) $1,462
                                      ====   ======     ====      ===  ======

    Basic net income (loss)
     per share attributable to
     Aon stockholders (1):
      Income from continuing
       operations                    $0.57    $0.56    $0.55    $0.44   $2.12
      Income (loss) from
       discontinued operations        0.13     3.25    (0.13)   (0.46)   2.87
                                      ----     ----    -----    -----    ----
      Net income (loss)              $0.70    $3.81    $0.42   $(0.02)  $4.99
                                     =====    =====    =====   ======   =====

    Dilutive net income (loss)
     per share attributable to
     Aon stockholders (1):
      Income from continuing
       operations                    $0.55    $0.54    $0.53    $0.42   $2.04
      Income (loss) from
       discontinued operations        0.12     3.12    (0.13)   (0.44)   2.76
                                      ----     ----    -----    -----    ----
      Net income (loss)              $0.67    $3.66    $0.40   $(0.02)  $4.80
                                     =====    =====    =====   ======   =====

    Weighted average common
     shares outstanding - diluted    323.3    309.3    293.9    291.4   304.5
                                     =====    =====    =====    =====   =====



                                                     2009
                                   ------------------------------------------
    (millions except per share       1st      2nd      3rd      4th     Full
     data)                         Quarter  Quarter  Quarter  Quarter   Year
                                   -------  -------  -------  -------   -----
    Revenue
    -------
      Commissions, fees and other   $1,821   $1,863   $1,778   $2,059  $7,521
      Investment income                 25       19       16       14      74
                                       ---      ---      ---      ---     ---
        Total revenue                1,846    1,882    1,794    2,073   7,595
                                     -----    -----    -----    -----   -----

    Expenses
    --------
      Compensation and benefits      1,014    1,134    1,119    1,330   4,597
      Other general expenses           406      470      425      434   1,735
      Depreciation and
       amortization                     60       58       56       68     242
                                       ---      ---      ---      ---     ---
        Total operating expenses     1,480    1,662    1,600    1,832   6,574
                                     -----    -----    -----    -----   -----
    Operating income                   366      220      194      241   1,021

      Interest income                    7        2       11       10      30
      Interest expense                 (29)     (26)     (32)     (35)   (122)
      Other income (expense)            (1)      14        5        2      20
                                       ---      ---      ---      ---     ---
    Income from continuing
     operations before income
     taxes                             343      210      178      218     949
      Income taxes                     108       57       47       56     268
                                       ---      ---      ---      ---     ---
    Income from continuing
     operations                        235      153      131      162     681
                                       ---      ---      ---      ---     ---

    Income (loss) from
     discontinued operations
     before income taxes                91        2        -      (10)     83
      Income taxes                      41        -       (3)     (66)    (28)
                                       ---      ---      ---      ---     ---
    Income (loss) from
     discontinued operations            50        2        3       56     111
                                       ---      ---      ---      ---     ---

    Net income (loss)                  285      155      134      218     792
      Less:  Net income
       attributable to the
       noncontrolling interests          5        6       14       20      45
                                       ---      ---      ---      ---     ---
    Net income (loss)
     attributable to Aon
     stockholders                     $280     $149     $120     $198    $747
                                      ====     ====     ====     ====    ====

    Net income (loss) attributable
     to Aon stockholders:
      Income from continuing
       operations                     $230     $147     $117     $142    $636
      Income (loss) from
       discontinued operations          50        2        3       56     111
                                       ---      ---      ---      ---     ---
      Net income (loss)               $280     $149     $120     $198    $747
                                      ====     ====     ====     ====    ====

    Basic net income (loss) per
     share attributable to
     Aon stockholders (1):
      Income from continuing
       operations                    $0.81    $0.52    $0.41    $0.51   $2.25
      Income (loss) from
       discontinued operations        0.18        -     0.01     0.20    0.39
                                      ----      ---     ----     ----    ----
      Net income (loss)              $0.99    $0.52    $0.42    $0.71   $2.64
                                     =====    =====    =====    =====   =====

    Dilutive net income (loss)
     per share attributable to
     Aon stockholders (1):
      Income from continuing
       operations                    $0.79    $0.50    $0.40    $0.49   $2.19
      Income (loss) from
       discontinued operations        0.17     0.01     0.01     0.20    0.38
                                      ----     ----     ----     ----    ----
      Net income (loss)              $0.96    $0.51    $0.41    $0.69   $2.57
                                     =====    =====    =====    =====   =====

    Weighted average common
     shares outstanding - diluted    292.0    292.7    292.1    287.8   291.1
                                     =====    =====    =====    =====   =====

    (1)  The basic and diluted earnings per share calculation was performed
         using the two-class method and included the impact of certain
         unvested share-based payment awards that have the right to receive
         nonforfeitable dividends.






    Aon Corporation
    Segments  - Reclassified for the changes in presentation of non-fiduciary
    investment income, equity income in non-consolidated subsidiaries,
    realized gains from investments, and investment expenses (unaudited)


                                                     2007
                                  ------------------------------------------
                                    1st      2nd       3rd      4th     Full
    (millions)                    Quarter  Quarter   Quarter  Quarter   Year
                                  -------  -------   -------  -------   ----
    Revenue
    -------
    Risk and insurance brokerage
     services segment
      As reported                  $1,429   $1,490    $1,411   $1,627  $5,957
      Less:  reclassification of
       non-fiduciary
       investment income                4        2         8        8      22
      Less:  reclassification of
       realized gains
       from investments                 -        6         -        -       6
      Less:  reclassification of
       equity income of non-
       consolidated subsidiaries        1        3         4        3      11
                                      ---      ---       ---      ---     ---
        As reclassified             1,424    1,479     1,399    1,616   5,918

    Consulting segment
      As reported                     329      325       325      373   1,352
      Less:  reclassification of
       non-fiduciary
       investment income                -        1         -        -       1
      Less:  reclassification of
       realized gains
       from investments                 -        5         -        -       5
      Less:  reclassification of
       equity income of non-
       consolidated subsidiaries        -        -         1        -       1
                                      ---      ---       ---      ---     ---
        As reclassified               329      319       324      373   1,345

    Unallocated
      As reported                      21       29        18       11      79
      Less:  reclassification of
       non-fiduciary
       investment income               21       28        17       11      77
      Less:  reclassification of
       realized gains
       from investments                 -        1         1        -       2
                                      ---      ---       ---      ---     ---
        As reclassified                 -        -         -        -       -

    Intersegment                      (10)      (6)       (8)      (5)    (29)
                                      ---      ---       ---      ---     ---
          Total                    $1,743   $1,792    $1,715   $1,984  $7,234
                                   ======   ======    ======   ======  ======

    Income (loss) before income taxes
    ---------------------------------
    Risk and insurance brokerage
     services segment
      As reported                    $238     $275      $231     $279  $1,023
      Less:  reclassification of
       non-fiduciary
       investment income                4        2         8        8      22
      Less:  reclassification of
       realized gains
       from investments                 -        6         -        -       6
      Less:  reclassification of
       investment expense               5       (5)       (3)      (2)     (5)
                                      ---      ---       ---      ---     ---
        As reclassified               229      272       226      273   1,000

    Consulting segment
      As reported                      47       44        38       60     189
      Less:  reclassification of
       non-fiduciary
       investment income                -        1         -        -       1
      Less:  reclassification of
       realized gains
       from investments                 -        5         -        -       5
      Less:  reclassification of
       investment expense               -        -         2        -       2
                                      ---      ---       ---      ---     ---
        As reclassified                47       38        36       60     181

    Unallocated
      As reported                     (47)     (39)      (38)     (65)   (189)
      Add:  reclassification of
       non-fiduciary
       investment income                4        3         8        8      23
      Add:  reclassification of
       realized gains
       from investments                 -       11         -        -      11
      Add:  reclassification of
       investment expense               5       (5)       (1)      (2)     (3)
                                      ---      ---       ---      ---     ---
        As reclassified               (38)     (30)      (31)     (59)   (158)

                                     ----     ----      ----     ----  ------
        Total                        $238     $280      $231     $274  $1,023
                                     ====     ====      ====     ====  ======

    Income from continuing
     operations before income
     taxes - margins
    -------------------------

    Risk and insurance brokerage
     services
         As reported                 16.7%    18.5%     16.4%    17.1%   17.2%
         As reclassified             16.1%    18.4%     16.2%    16.9%   16.9%

    Consulting
         As reported                 14.3%    13.5%     11.7%    16.1%   14.0%
         As reclassified             14.3%    11.9%     11.1%    16.1%   13.5%

    Total
         As reported                 13.5%    15.2%     13.2%    13.7%   13.9%
         As reclassified             13.7%    15.6%     13.5%    13.8%   14.1%



                                                     2008
                                  ------------------------------------------
                                    1st      2nd       3rd      4th     Full
    (millions)                    Quarter  Quarter   Quarter  Quarter   Year
                                  -------  -------   -------  -------   ----
    Revenue
    -------
    Risk and insurance brokerage
     services segment
      As reported                  $1,566   $1,610    $1,473   $1,581  $6,230
      Less:  reclassification of
       non-fiduciary
       investment income                7        5         5        7      24
      Less:  reclassification of
       realized gains
       from investments                 -        -         -        -       -
      Less:  reclassification of
       equity income of non-
       consolidated subsidiaries        -        2         2        5       9
                                      ---      ---       ---      ---     ---
        As reclassified             1,559    1,603     1,466    1,569   6,197

    Consulting segment
      As reported                     343      336       337      342   1,358
      Less:  reclassification of
       non-fiduciary
       investment income                -        1         1        -       2
      Less:  reclassification of
       realized gains
       from investments                 -        -         -        -       -
      Less:  reclassification of
       equity income of non-
       consolidated subsidiaries        -        -         -        -       -
                                      ---      ---       ---      ---     ---
        As reclassified               343      335       336      342   1,356

    Unallocated
      As reported                       5       17        40        6      68
      Less:  reclassification of
       non-fiduciary
       investment income                5       17        40        6      68
      Less:  reclassification of
       realized gains
       from investments                 -        -         -        -       -
                                      ---      ---       ---      ---     ---
        As reclassified                 -        -         -        -       -

    Intersegment                       (9)      (7)       (4)      (5)    (25)
                                      ---      ---       ---      ---     ---
          Total                    $1,893   $1,931    $1,798   $1,906  $7,528
                                   ======   ======    ======   ======  ======

    Income (loss) before income taxes
    ---------------------------------
    Risk and insurance brokerage
     services segment
      As reported                    $243     $234      $192     $220    $889
      Less:  reclassification of
       non-fiduciary
       investment income                7        5         5        7      24
      Less:  reclassification of
       realized gains
       from investments                 -        -         -        -       -
      Less:  reclassification of
       investment expense               -        -        (2)       -      (2)
                                      ---      ---       ---      ---     ---
        As reclassified               236      229       189      213     867

    Consulting segment
      As reported                      63       43        52       56     214
      Less:  reclassification of
       non-fiduciary
       investment income                -        1         1        -       2
      Less:  reclassification of
       realized gains
       from investments                 -        -         -        -       -
      Less:  reclassification of
       investment expense               1        -         1        1       3
                                      ---      ---       ---      ---     ---
        As reclassified                62       42        50       55     209

    Unallocated
      As reported                     (48)     (51)      (26)     (99)   (224)
      Add:  reclassification of
       non-fiduciary
       investment income                7        6         6        7      26
      Add:  reclassification of
       realized gains
       from investments                 -        -         -        -       -
      Add:  reclassification of
       investment expense               1        -        (1)       1       1
                                      ---      ---       ---      ---     ---
        As reclassified               (40)     (45)      (21)     (91)   (197)

                                     ----     ----      ----     ----    ----
        Total                        $258     $226      $218     $177    $879
                                     ====     ====      ====     ====    ====

    Income from continuing
     operations before income
     taxes - margins
    -------------------------

    Risk and insurance brokerage
     services
          As reported                15.5%    14.5%     13.0%    13.9%   14.3%
          As reclassified            15.1%    14.3%     12.9%    13.6%   14.0%

    Consulting
         As reported                 18.4%    12.8%     15.4%    16.4%   15.8%
         As reclassified             18.1%    12.5%     14.9%    16.1%   15.4%

    Total
         As reported                 13.5%    11.6%     11.8%     9.2%   11.5%
         As reclassified             13.6%    11.7%     12.1%     9.3%   11.7%



                                                      2009
                                  ------------------------------------------
                                    1st      2nd       3rd      4th     Full
    (millions)                    Quarter  Quarter   Quarter  Quarter   Year
                                  -------  -------   -------  -------   ----
    Revenue
    -------
    Risk and insurance brokerage
     services segment
      As reported                  $1,550   $1,578    $1,489   $1,700  $6,317
      Less:  reclassification of
       non-fiduciary
       investment income                6        -         2        -       8
      Less:  reclassification of
       realized gains
       from investments                 -        -         -        -       -
      Less:  reclassification of
       equity income of non-
       consolidated subsidiaries        1        1         2        -       4
                                      ---      ---       ---      ---     ---
        As reclassified             1,543    1,577     1,485    1,700   6,305

    Consulting segment
      As reported                     309      300       308      350   1,267
      Less:  reclassification of
       non-fiduciary
       investment income                -        -         -        -       -
      Less:  reclassification of
       realized gains
       from investments                 -        -         -        -       -
      Less:  reclassification of
       equity income of non-
       consolidated subsidiaries        -        -         -        -       -
                                      ---      ---       ---      ---     ---
        As reclassified               309      300       308      350   1,267

    Unallocated
      As reported                       1       13        19       29      62
      Less:  reclassification of
       non-fiduciary
       investment income                1        2         9        -      12
      Less:  reclassification of
       realized gains
       from investments                 -        -         1        -       1
                                      ---      ---       ---      ---     ---
        As reclassified                 -       11         9       29      49

    Intersegment                       (6)      (6)       (8)      (6)    (26)
                                      ---      ---       ---      ---     ---
          Total                    $1,846   $1,882    $1,794   $2,073  $7,595
                                   ======   ======    ======   ======  ======

    Income (loss) before income taxes
    ---------------------------------
    Risk and insurance brokerage
     services segment
      As reported                    $328     $210      $188     $196    $922
      Less:  reclassification of
       non-fiduciary
       investment income                6        -         2        -       8
      Less:  reclassification of
       realized gains
       from investments                 -        -         -        -       -
      Less:  reclassification of
       investment expense               -        -         -        -       -
                                      ---      ---       ---      ---     ---
        As reclassified               322      210       186      196     914

    Consulting segment
      As reported                      70       41        33       61     205
      Less:  reclassification of
       non-fiduciary
       investment income                -        -         -        -       -
      Less:  reclassification of
       realized gains
       from investments                 -        -         -        -       -
      Less:  reclassification of
       investment expense               -        -         -        -       -
                                      ---      ---       ---      ---     ---
        As reclassified                70       41        33       61     205

    Unallocated
      As reported                     (55)     (41)      (43)     (39)   (178)
      Add:  reclassification of
       non-fiduciary
       investment income                6        -         2        -       8
      Add:  reclassification of
       realized gains
       from investments                 -        -         -        -       -
      Add:  reclassification of
       investment expense               -        -         -        -       -
                                      ---      ---       ---      ---     ---
        As reclassified               (49)     (41)      (41)     (39)   (170)

                                     ----     ----      ----     ----    ----
        Total                        $343     $210      $178     $218    $949
                                     ====     ====      ====     ====    ====

    Income from continuing
     operations before income
     taxes - margins
    -------------------------

    Risk and insurance brokerage
     services
         As reported                 21.2%    13.3%     12.6%    11.5%   14.6%
         As reclassified             20.9%    13.3%     12.5%    11.5%   14.5%

    Consulting
         As reported                 22.7%    13.7%     10.7%    17.4%   16.2%
         As reclassified             22.7%    13.7%     10.7%    17.4%   16.2%

    Total
         As reported                 18.5%    11.1%      9.8%    10.5%   12.5%
         As reclassified             18.6%    11.2%      9.9%    10.5%   12.5%




SOURCE Aon Corporation

Stock Quote: NYSE

Price 282.78

Change -1.54

Volume 813,696

% Change -0.54%

Intraday High 284.49

52 Week High 341.98

Intraday Low 280.05

52 Week Low 246.21

Today's Open 281.78

Previous Close 284.32

Oct 05, 2022 04:03 PM Pricing delayed 20 minutes
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