Mr. Spitzer's office would not comment on the status of any settlement talks with the company.

Of the $50 million liability reserve, $43 million is being allocated to the Risk and Insurance Brokerage Service segment and the balance to its consulting arm.

In terms of reserves, the $50 million is small in comparison to more than $230 million that Marsh & McLennan set up after a suit was filed by Mr. Spitzer over allegations that its New York-based insurance brokerage subsidiary, Marsh, fixed prices, rigged bids and steered commercial customers to insurers who paid kickbacks disguised as incentive fees or contingency agreements.

MMC eventually settled for $850 million with Mr. Spitzer's office to compensate clients harmed by the alleged illegitimate deal-making a few weeks ago.

In an investor and analyst conference call held today, Patrick G. Ryan, the firm's chairman and chief executive officer, said Aon has reached a point with New York and other states where it felt it was time to create the fund, but it has not reached any settlements. He added that the company is continuing to cooperate in the investigation.

During questioning, Mr. Ryan said Aon has not engaged in any bid-rigging or solicitation of false quotes, which were charged in the civil action against MMC. He did not say what issues would need to be disposed of with the settlement fund.

He said Aon's fund is smaller than that set up by Marsh because it did not engage in the more egregious violations Marsh was accused of. Aon's share of contingent commissions was significantly less than Marsh, he added.

For the fourth quarter, Aon net income dropped $26 million, from $215 million, or 65 cents a share in 2003, to $189 million, or 56 cents a share. Without the reserve charge, net income would have increased 11 percent, or $24 million, the company said.

Total revenue in the quarter rose 3 percent, or $86 million, from $2.58 billion to $2.66 billion.

For the year, net income rose 4 percent, or $26 million, going from $628 million, or $1.90 a share, to $654 million, or $1.95 a share. Revenues were up 5 percent, or $454 million, going from $9.72 billion to $10.2 billion.

The broker renewed its three-year U.S. credit line for $600 million and a ?650 million ($832 million U.S.) credit line with international banks.

Mr. Ryan said that Aon is continuing to control expenses through a hiring freeze, "aggressive pursuit" of new business, and taking advantage of new technologies.