Exhibit 12(b)
Aon Corporation and Consolidated Subsidiaries
Combined With Unconsolidated Subsidiaries
Computation of Ratio of Earnings to Combined Fixed Charges
and Preferred Stock Dividends
First Quarter
Ended March 31, Years Ended December 31,
-------------------- -----------------------------------------------------------
(millions except ratios) 1998 1997 1997 1996 1995 1994 1993
---------- ---------- ---------- ---------- ---------- --------- ----------
Income from continuing operations
before provision for income taxes (1) $ 237.8 $ 15.2 $ 541.6 $ 445.6 $ 458.0 $ 397.0 $ 331.6
ADD BACK FIXED CHARGES:
Interest on indebtedness 20.1 14.6 69.5 44.7 55.5 46.4 42.3
Interest on ESOP 0.7 1.0 3.5 4.3 5.3 5.9 6.5
Portion of rents representative of
interest factor 11.1 14.7 44.3 28.6 21.4 28.7 26.1
---------- ---------- ---------- ---------- ---------- --------- ----------
INCOME AS ADJUSTED $ 269.7 $ 45.5 $ 658.9 $ 523.2 $ 540.2 $ 478.0 $ 406.5
========== ========== ========== ========== ========== ========= ==========
FIXED CHARGES AND PREFERRED STOCK DIVIDENDS:
Interest on indebtedness $ 20.1 $ 14.6 $ 69.5 $ 44.7 $ 55.5 $ 46.4 $ 42.3
Preferred stock dividends 17.4 19.4 82.1 28.7 37.5 48.4 47.5
---------- ---------- ---------- ---------- ---------- --------- ----------
Interest and dividends 37.5 34.0 151.6 73.4 93.0 94.8 89.8
Interest on ESOP 0.7 1.0 3.5 4.3 5.3 5.9 6.5
Portion of rents representative of
interest factor 11.1 14.7 44.3 28.6 21.4 28.7 26.1
TOTAL FIXED CHARGES AND PREFERRED
---------- ---------- ---------- ---------- ---------- --------- ----------
STOCK DIVIDENDS $ 49.3 $ 49.7 $ 199.4 $ 106.3 $ 119.7 $ 129.4 $ 122.4
========== ========== ========== ========== ========== ========= ==========
RATIO OF EARNINGS TO COMBINED FIXED
CHARGES AND PREFERRED STOCK DIVIDENDS (2) 5.5 0.9 3.3 4.9 4.5 3.7 3.3
========== ========== ========== ========== ========== ========= ==========
RATIO OF EARNINGS TO COMBINED FIXED
CHARGES AND PREFERRED STOCK DIVIDENDS (3) 3.8 4.2 5.8
========== ========== ==========
<FN>
(1) Income from continuing operations before provision for income taxes and
minority interest includes special charges of $145 million in first
quarter ended March 31, 1997 and $172 million and $90.5 million in the
years ended December 31, 1997 and 1996, respectively.
(2) Included in total fixed charges and preferred stock dividends for the
first quarter ended March 31, 1998 and 1997 are $16.4 million and $14.1
million, respectively, and $64 million for the year ended December 31,
1997 of pretax distributions on the 8.205% mandatorily redeemable
preferred capital securities which are classified as "minority interest"
on the condensed consolidated statements of operations. The ratio of
earnings to combined fixed charges and preferred stock dividends
for first quarter ended March 31, 1997 is less than a one-to-one
coverage indicating that earnings are inadequate to cover fixed charges
by $4.2 million.
(3) The calculation of this ratio of earnings to fixed charges reflects the
exclusion of special charges from the income from continuing operations
before provision for income taxes component for first quarter ended
March 31, 1997 and for the years ended December 31, 1997 and 1996,
respectively.
</FN>