<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0303</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2010-02-22</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0001163348</issuerCik>
        <issuerName>ALLIED WORLD ASSURANCE CO HOLDINGS LTD</issuerName>
        <issuerTradingSymbol>AWH</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001368328</rptOwnerCik>
            <rptOwnerName>Dupont Wesley D</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>ALLIED WORLD ASSURANCE CO HOLDINGS, LTD</rptOwnerStreet1>
            <rptOwnerStreet2>27 RICHMOND ROAD</rptOwnerStreet2>
            <rptOwnerCity>PEMBROKE</rptOwnerCity>
            <rptOwnerState>D0</rptOwnerState>
            <rptOwnerZipCode>HM 08</rptOwnerZipCode>
            <rptOwnerStateDescription>BERMUDA</rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>0</isDirector>
            <isOfficer>1</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>0</isOther>
            <officerTitle>EVP, Gen. Counsel &amp; Corp. Sec.</officerTitle>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>Common Shares</value>
            </securityTitle>
            <transactionDate>
                <value>2010-02-22</value>
            </transactionDate>
            <deemedExecutionDate></deemedExecutionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>A</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionTimeliness>
                <value></value>
            </transactionTimeliness>
            <transactionAmounts>
                <transactionShares>
                    <value>26250</value>
                    <footnoteId id="F1"/>
                </transactionShares>
                <transactionPricePerShare>
                    <value>0.00</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>66143</value>
                    <footnoteId id="F2"/>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
    </nonDerivativeTable>

    <derivativeTable>
        <derivativeTransaction>
            <securityTitle>
                <value>Restricted Stock Units</value>
            </securityTitle>
            <conversionOrExercisePrice>
                <footnoteId id="F3"/>
            </conversionOrExercisePrice>
            <transactionDate>
                <value>2010-02-22</value>
            </transactionDate>
            <deemedExecutionDate></deemedExecutionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>A</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionTimeliness>
                <value></value>
            </transactionTimeliness>
            <transactionAmounts>
                <transactionShares>
                    <value>3500</value>
                    <footnoteId id="F3"/>
                </transactionShares>
                <transactionPricePerShare>
                    <value>0.00</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <exerciseDate>
                <footnoteId id="F4"/>
            </exerciseDate>
            <expirationDate>
                <footnoteId id="F4"/>
            </expirationDate>
            <underlyingSecurity>
                <underlyingSecurityTitle>
                    <value>Common Shares</value>
                </underlyingSecurityTitle>
                <underlyingSecurityShares>
                    <value>2100</value>
                    <footnoteId id="F3"/>
                </underlyingSecurityShares>
            </underlyingSecurity>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>7500</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </derivativeTransaction>
    </derivativeTable>

    <footnotes>
        <footnote id="F1">Represents the Company's Common Shares that were earned pursuant to a 2007 LTIP award for no monetary consideration and which vested at 150% of target based on the achievement of pre-established performance criteria during the applicable three-year performance period established under the Company's Amended and Restated Long-Term Incentive Plan.</footnote>
        <footnote id="F2">Includes 520 Common Shares acquired on June 30, 2009 and 92 Common Shares acquired on December 31, 2009 pursuant to the Company's 2008 Employee Share Purchase Plan.</footnote>
        <footnote id="F3">Grant of Restricted Stock Units for no monetary consideration.  3,500 Restricted Stock Units convert into (i) 2,100 of the Company's Common Shares and (ii) cash equal to the market value of 1,400 Common Shares (measured at the date of vesting) upon the vesting of such Restricted Stock Units.</footnote>
        <footnote id="F4">The Restricted Stock Units vest in four equal installments with the first installment vesting on February 22, 2011.</footnote>
    </footnotes>

    <remarks></remarks>

    <ownerSignature>
        <signatureName>/s/ Wayne H. Datz, by Power of Attorney</signatureName>
        <signatureDate>2010-02-24</signatureDate>
    </ownerSignature>
</ownershipDocument>
