A.M. Best Places Ratings of Allmerica Financial Life Insurance and Annuity Company Under Review.

OLDWICK, N.J. -- A.M. Best Co. has placed the financial strength rating (FSR) of B+ (Very Good) and the issuer credit rating (ICR) of "bbb-" of Allmerica Financial Life Insurance and Annuity Company (AFLIAC) (Worcester, MA) under review with positive implications.

These actions follow the announcement of a modified coinsurance agreement with Chase Insurance Life and Annuity Company (CILAC) (Elgin, IL), in which AFLIAC will coinsure approximately $3.3 billion of variable annuity reserves. This transaction is concurrent with Protective Life Corporation's (Protective) (NYSE: PL) (Birmingham, AL) announcement today that it has signed a definitive agreement to acquire the five life/health insurance subsidiaries of JPMorgan Chase & Co. (NYSE: JPM), which includes CILAC. (See related February 8, 2006 press release on Protective.)

The reinsurance transaction by AFLIAC will be entirely funded by The Goldman Sachs Group, Inc., (Goldman), which acquired AFLIAC on December 30, 2005. As a result, this new reinsurance arrangement will immediately accrue to AFLIAC's earnings in 2006 upon close. In addition, this transaction will add scale to the AFLIAC variable product platform and provide diversity to the consolidated block, which would result in improvement to the company's risk- based capital position under the new C-3 Phase II guidelines. AFLIAC will utilize the expertise of Goldman for risk-mitigating techniques, including hedging.

The aggregate transactions are expected to close in the third quarter of 2006. A.M. Best will review the FSR and ICR of AFLIAC for possible upgrades, at the close of the transactions, which are all pending regulatory approval. A.M. Best will conduct additional dialogue with AFLIAC's management related to Goldman's capital, risk management, acquisition appetite and strategy.

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