Independence Holding Company Announces Agreement to Acquire Actuarial Management Corporation.

STAMFORD, Conn. -- Independence Holding Company (NYSE: IHC) today announced that it has entered into a letter of intent to acquire Actuarial Management Corporation ("AMC"). AMC is a leading, full-service actuarial firm headquartered in Concord, CA that focuses on fully insured health coverage for small groups, individuals and families, short-term medical and employer medical stop-loss. AMC is currently responsible for all actuarial aspects of IHC's entire book of fully insured health business. AMC's team of 19 dedicated professionals has extensive experience providing clients in the health insurance industry with development and management services, underwriting and benefit design review, data reporting, compliance support and strategic and tactical management services.

The acquisition of AMC significantly advances IHC's objective of realizing increased underwriting profits by further integrating AMC's proprietary actuarial modeling and technical expertise with IHC's existing capabilities. Closing of the acquisition is subject to the execution of definitive agreements, the satisfactory completion of IHC's due diligence review and certain other customary conditions, and is expected to occur early in the second quarter of 2007. Bernon R. ("Bernie") Erickson, Jr. will continue as CEO and President of AMC following the closing. IHC anticipates that, prior to the closing, Mr. Erickson will be appointed Senior Vice President and Chief Health Actuary of IHC.

"IHC's companies are long-standing clients of AMC. We expect this acquisition to facilitate the maintenance and improvement of our existing block of premiums, and look forward to bringing AMC's considerable talents more fully to employer stop-loss, which remains our most significant business line. The acquisition of AMC, and Bernie's appointment as an IHC senior executive, will ensure that we have the necessary in-house actuarial talent to manage our growth to expected profit margins," commented Roy Thung, IHC's Chief Executive Officer.

Mr. Erickson stated, "I am honored to be joining forces with such a respected and sound company. Following the closing, AMC will remain as an independent business under my leadership and will continue to provide outstanding service and resources to all of its clients, both inside and outside IHC."

About Independence Holding Company

IHC is a holding company principally engaged in the life and health insurance business and the acquisition of blocks of policies through its insurance company subsidiaries (Standard Security Life Insurance Company of New York and Madison National Life Insurance Company, Inc.), its affiliate (American Independence Corp. (NASDAQ: AMIC)), and its managing general underwriters, third-party administrators and marketing affiliates. Standard Security Life markets medical stop-loss, employer-sponsored group major medical, short-term medical, group long and short-term disability and life, dental, vision and managed health care products. Madison National Life sells group life and disability, employer medical stop-loss, employer-sponsored group major medical, short-term medical, dental, vision, credit life and disability and individual life insurance. AMIC is a holding company principally engaged in the insurance and reinsurance business through Independence American Insurance Company and its managing general underwriter division.

Certain statements in this news release regarding the proposed transaction between IHC and AMC may be considered "forward-looking statements," such as statements relating to expectations for IHC's and AMC's businesses, whether and when the transaction will close and its impact on IHC's results. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from historical experience or from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, IHC's ability to successfully operate AMC without disruption to its other business activities, IHC's ability to achieve the anticipated results from the acquisition of AMC, the effects of competition (in particular the response to the transaction in the marketplace), economic conditions in the markets in which we operate and other factors which can be found in IHC's press releases and filings with the SEC.