XL Capital Ltd Announces That Contingent Additional Principal Will Accrue On Its Liquid Yield Option (TM) Notes Due 2021 (""LYONs"")

HAMILTON, BERMUDA - August 21, 2003

Hamilton, Bermuda (August 21, 2003) - XL Capital Ltd (NYSE: XL) ("XL") announced today that Contingent Additional Principal (as defined in the indenture (the "Indenture") governing the LYONs) in the amount of 64.5 basis points will accrue on XL's LYONs for the period from September 7, 2003 through September 6, 2004 under the terms of the Indenture, resulting in a total effective accretion rate of 3.52% over such period.XL Capital Ltd, through its operating subsidiaries, is a leading provider of insurance and reinsurance coverages and financial products to industrial, commercial and professional service firms, insurance companies, and other enterprises on a worldwide basis. As of June 30, 2003, XL Capital Ltd had consolidated assets of approximately $39.2 billion and consolidated shareholders' equity of approximately $7.6 billion. More information about XL Capital Ltd is available at www.xlgroup.com.