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Aspen Launches Program to Enhance Operating Effectiveness and Efficiency

25th October

Expected Cumulative Savings of Approximately $160 Million by End of 2020

Expected Run Rate Savings of Approximately $80 Million Starting in 2021

70% of Expected Savings to Benefit the Insurance Segment

Aspen launched today a comprehensive program to drive greater effectiveness and efficiency across the Company and enhance its market position.

Chris O’Kane, Chief Executive Officer, commented “Aspen is a diversified, global company with a strong balance sheet and specialty underwriters across many lines of business. Over the past 15 years, we have developed an underwriting-focused culture that provides creative solutions to our clients and brokers. Today we are announcing a program that will elevate the effectiveness and efficiency of our operating platform and position us for continued success in the future.”

Through actions that optimize work processes and increase operational efficiency, the program is expected to deliver cumulative total expense savings of approximately $160 million over the next three years. The Company expects to achieve $30 million of the savings in 2018, $55 million in 2019 and $75 million in 2020, after which run-rate savings are expected to be approximately $80 million per year.

Aspen expects to incur pre-tax charges of approximately $95 million to implement the program and achieve the savings. Aspen expects to incur the majority of this charge in 2018 and 2019. Aspen also expects to spend a total of approximately $55 million in incremental capital expenditure, primarily information technology, in 2018 and 2019 that is expected to be amortized over a period of three to five years from the start of 2020.

Chris O’Kane added, “The program is the result of a rigorous bottom up operational review of our organization which balanced both risks and rewards. The planned actions are highly achievable and will enable our underwriters to focus more of their time on client and broker facing activities rather than on routine and duplicative tasks. The majority of the expected savings will benefit our Insurance segment where we continue to build on the business line assessment we conducted in 2016 and the drive to improve profitability. As a result of this program, we believe Aspen will be a more nimble organization with faster decision-making ability, a competitive expense ratio and the ability to serve our clients even better than we do today.”

Aspen intends to provide updates on the program implementation on a semi-annual basis.