A.M. Best Assigns Ratings to the Life Insurance Subsidiaries of Direct General Group

Business Wire, March 6, 2007

OLDWICK, N.J. -- A.M. Best Co. has assigned a financial strength rating of B (Fair) and issuer credit ratings of "bb " to Direct Life Insurance Company (Griffin, GA) and Direct General Life Insurance Company (Aiken, SC). The outlook for these ratings is stable. These companies comprise the life insurance subsidiaries of Direct General Group, a wholly owned subsidiary of Direct General Corporation (both of Nashville, TN) [NYSE: DRCT].

The ratings reflect the group's limited business profile as reflected in its monoline product offering, dependence on the affiliated property/casualty agency force to sell life insurance, high lapse rates on its insurance products and the dividend service requirements from its parent. Offsetting these negative factors are the adequate level of capitalization and positive trends in premium growth and operating earnings.

Additionally, as outlined in A.M. Best's December 6, 2006 press release, Direct General Corp. announced it had reached a definitive agreement to be acquired by Elara Holdings Inc. (Delaware) an affiliate of Fremont Partners and Texas Pacific Group.

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.