Financial Guarantees - We are contingently liable for financial guarantee exposures ceded through reinsurance agreements with a company in which we formerly had a minority ownership interest totaling approximately $76 million as of Dec. 31, 1998.

Lease Commitments - A portion of our business activities is carried on in rented premises. We also enter into leases for equipment, such as office machines and computers. Our total rental expense was $88 million in 1998, $92 million in 1997 and $107 million in 1996.

Certain leases are noncancelable, and we would remain responsible for payment even if we stopped using the space or equipment. On Dec. 31, 1998, the minimum annual rents for which we would be liable under these types of leases are as follows: $109 million in 1999, $104 million in 2000, $105 million in 2001, $70 million in 2002, $56 million in 2003 and $265 million thereafter.

We are also the lessor under various subleases on our office facilities. The minimum rentals to be received in the future under noncancelable subleases is $99 million at Dec. 31, 1998.

Legal Matters - In the ordinary course of conducting business, we and some of our subsidiaries have been named as defendants in various lawsuits. Some of these lawsuits attempt to establish liability under insurance contracts issued by our underwriting operations. Plaintiffs in these lawsuits are asking for money damages or to have the court direct the activities of our operations in certain ways.

In connection with our sale of Minet to Aon Corporation in 1997, we agreed to indemnify Aon against any future professional liability claims for events that occurred prior to the sale. Included in our 1997 provision for loss on disposal of Minet was the cost of purchasing insurance to cover a portion of our exposure to such claims (see Note 13 "Discontinued Operations").