A.M. Best Assigns Rating to Jefferson-Pilot's New Debt Offerings; Affirms Financial Strength and Existing Debt Ratings.

Business Editors

OLDWICK, N.J.--(BUSINESS WIRE)--Jan. 22, 2004

A.M. Best Co. has assigned a debt rating of "aa-" to the $300 million 4.75% 10-year senior unsecured notes and debt ratings of AMB-1+ (short-term) and "aa-" (long-term) to the $300 million senior unsecured floating-rate notes (Extendible Liquidity Securities, EXLs) issued by Jefferson-Pilot Corporation (Jefferson-Pilot) (NYSE: JP) (Greensboro, NC). Concurrently, A.M. Best has affirmed the group financial strength rating of A++ (Superior) of Jefferson-Pilot's principal life insurance and annuity companies as well as the ratings on its existing debt securities. The outlook for all ratings is stable.

The EXLs have an initial maturity of February 2005 and a final maturity of February 2011. Commencing three months from the issue date and each subsequent quarter, the investor can elect to extend the maturity of all or a portion of the principal amount for a 13-month period. The company will make monthly interest payments, based on the one-month LIBOR, plus an applicable spread for that interest period--the spread increases gradually every 12 months beginning each February and levels off in years five through seven.

The proceeds from the note offerings will be used to pay down short-term borrowings and to fund the recently announced acquisition of the U.S. group life, disability and dental business of Canada Life Assurance Company (Canada Life) (Ontario) and for general corporate purposes. Although the new debt slightly increases Jefferson-Pilot's overall financial leverage, its capital structure remains conservative and results in enhanced flexibility as rollover risk is reduced considerably. In addition, A.M. Best views positively the purchase of the Canada Life block as it adds distribution and scale in product lines where Jefferson-Pilot already has an established presence and competitive advantages in technology, expenses and customer satisfaction. The transaction is expected to add slightly to earnings in 2004 and approach returns consistent with the company's existing group business over the next 18-24 months.

The ratings reflect Jefferson-Pilot's diverse and sustainable earnings, ample fixed charge coverage, sound capital management, solid capitalization, sophisticated asset-liability management and high-quality investment portfolio. The company is a leading provider of fixed universal life products and maintains a top-twenty ranking in both fixed annuity and variable universal life insurance sales. Jefferson-Pilot generates the majority of earnings from its core individual life and fixed-annuity operations. These earnings have been consistently strong and, on a stand-alone basis, well support the company's fixed charge obligations. Jefferson-Pilot's operating subsidiaries are well capitalized and its pro forma estimated year-end 2003 financial leverage--approximately 22% including capital securities--remains consistent with the rating category. Absent another acquisition, A.M. Best expects Jefferson-Pilot's debt-to-capital ratio to revert to the 18%-20% range in the near term.

Jefferson-Pilot's strengths are tempered somewhat by its lack of scale in variable products, its exposure to operational risks inherent in the group business and the challenges it faces in sustaining revenue and earnings growth in an increasingly competitive environment.

For a complete list of Jefferson-Pilot Corporation's debt and financial strength ratings, please visit www.ambest.com/press/012201jeffersonpilot.pdf.

For a complete list of A.M. Best's debt ratings, please visit http://www3.ambest.com/debtratings/.

A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com.