A.M. Best Downgrades and Assigns Ratings to Unified Life Insurance Company

Business Wire, June 20, 2007

OLDWICK, N.J. -- A.M. Best Co. has downgraded the financial strength rating (FSR) to B (Good) from A- (Excellent) and assigned an issuer credit rating (ICR) of "bbb " to Unified Life Insurance Company (Unified) (Dallas, TX). The outlook for both ratings is stable.

The downgrade reflects Unified's low absolute level of capital and surplus, evolving business profile and A.M. Best's concern over the company's ability to fund planned acquisitions as growth opportunities are expected to produce surplus strain in the near term. Additionally, Old Mutual's 30% minority ownership interest in the company, a potential source of capital and support since 2001, was purchased by the primary shareholder in May 2007.

Offsetting factors are the continued statutory profitability, adequate risk-adjusted capitalization, a high quality bond portfolio and the company's ability to decrease expenses by integrating acquisitions. Despite continued growth prior to year-end 2006, Unified's capital position is modest when compared to peers. A.M. Best believes the company will be exposed to competitive pressures in new product lines, which could further strain capital.

For Best's Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.> Founded in 1899, A.M. Best Company is a full-service credit rating organization dedicated to serving the financial services industries, including the banking and insurance sectors. For more information, visit www.ambest.com.