AIR and John P. Woods Co. Prepare First Terrorism and Earthquake Catastrophe Loss Analyses of a Life Insurance Portfolio for UnumProvident Corporation.

Business Editors

BOSTON--(BUSINESS WIRE)--Jan. 27, 2003

AIR Worldwide Corporation (AIR), the technological leader in catastrophe modeling and weather risk management, and John P. Woods Co., Inc. (JPW), a leading reinsurance intermediary, today announced the first probabilistic catastrophe loss analyses ever performed on a large nationwide portfolio of life, accident, and disability insurance policies. The portfolio of UnumProvident has been analyzed by AIR for terrorism and earthquake risk in the United States. JPW, UnumProvident's catastrophe reinsurance broker, arranged and assisted with the analysis.

Using its Terrorism Loss Estimation Model and U.S. earthquake model, AIR has developed a probabilistic loss and concentration of exposure analysis for three lines including life, accidental death and dismemberment, and disability.

"The risk of personal injuries and fatalities due to extreme events is more uncertain today due to the threat of terrorism. It is now more important than ever for UnumProvident to better understand the potential loss," said Tom White, Vice President, Corporate Relations of UnumProvident. "After the terrorist attacks on the World Trade Center, reinsurance costs for life insurance rose dramatically. In the past, assessing our detailed exposure to catastrophic risks was not as necessary because reinsurance was readily available at reasonable rates. Now, with the current potential for large losses combined with high reinsurance rates, a careful quantification of the risk is essential for our business. We felt that catastrophe modeling was the best approach available for assessing the risk."

September 2001 brought home the realization that catastrophic losses can occur across multiple lines of business as a result of a single event. Since then, insurers have turned to catastrophe modeling technologies that once focussed almost exclusively on property losses. AIR has released models that provide insurers with estimates of loss from fatalities and disabling injuries that result from both terrorist attacks, the effects of which can be quite localized, and from major earthquakes, which can affect a much larger geographical area.

"UnumProvident is breaking new ground in the life insurance industry by employing catastrophe modeling technology to estimate potential loss," said Lou Estrema, Managing Director of Specialty Catastrophe Services, Inc., a subsidiary of JPW. "As a leader in its field, UnumProvident realizes its exposure to extreme events has increased over the past year. By turning to AIR for its expertise in catastrophe modeling, UnumProvident has taken an important step in managing the emerging risk."

About UnumProvident Corporation

The subsidiaries of UnumProvident Corporation offer a comprehensive, integrated portfolio of products and services backed by industry-leading return-to-work resources and disability expertise. UnumProvident is the world leader in protecting income and lifestyles through its comprehensive offering of group, individual and voluntary benefits products and services. UnumProvident has operations in the United States, Canada and the U.K.

About AIR Worldwide Corporation

AIR Worldwide Corporation (AIR) is a leading catastrophe and weather risk modeling company. Through its web-based and computer software solutions (ClimateCast(TM), CLASIC/2(TM), CATRADER(R), CATMAP(R)/2, AIRProfiler(R)), AIR services the insurance, reinsurance and capital markets. AIR's models simulate losses from both man-made and natural catastrophes in more than 35 countries. AIR is headquartered in Boston and has additional offices in North America, Europe and Asia. For more information, please visit the AIR website at www.air-worldwide.com.

About John P. Woods Co., Inc.

Since 1978, John P. Woods Co., Inc. (JPW) has offered clients a full-range of property/casualty and life, accident and health treaty reinsurance products. JPW represents more than 100 clients that cede in excess of $1 billion in property/casualty and life, accident and health premiums. JPW is a subsidiary of Arthur J. Gallagher & Co., the fourth largest insurance broker in the world.