2006 rating trends: positive trends continued in life/health rating upgrades.

Following its robust performance in 2005, the life/health insurance industry enjoyed another strong year, with favorable operating earnings recorded again in 2006, according to the A.M. Best Co. Special Report Positive Trend in Rating Upgrades Continued in 2006, but Margin Narrowed.

With favorable balance-sheet strength for the industry continuing in 2006, A.M. Best's rating outlook for the industry was stable, and the share of companies now enjoying "Secure" ratings increased to the highest level of this nascent century.

Rating Changes Life/Annuity and Health
Rating Units 2005 and 2006

                           Number of
                            Rating
                           Changes

                          2005   2006

Total upgrades              31     33
Total downgrades            25     32
Life/Annuity Upgrades       11     18
Health Upgrades             20     15
Life/Annuity Downgrades     17     21
Health Downgrades            8     11

Note: Table made from bar graph.

Note: Multicompany groups are treated as one unit.

Source: A.M. Best Co.

Vulnerable Rating Distribution, Life/Annuity
and Health--2004 to 2006

             2004   2005   2006

(Fair)

B              70     58     64
B-             37     34     39

(Marginal)

C++            50     40     51
C+             41     45     30

(Weak)

C              19     27      8
C-              6      7      7

(Poor)

D               2      4      3

Note: Table made from bar graph.

Source: A.M. Best Co.

Ratings as of year end.

Rating Outlook Life/Annuity and Health - 2006

Positive    8%
Negative   14%
Stable     78%

Note: Table made from pie chart.

Source: A.M. Best Co.

Ratings as of Dec. 31, 2006