UNITED AMERICAN AND FIRST UNITED AMERICAN

1. UNITED AMERICAN AND FIRST UNITED AMERICAN Recruiting and Training Webinar

2. Attendees Receive Gas 2000 LUNCH $250 GAS CARD DRAWING MONTHLY LEAD DRAWING $10 GIFTCARD Gas 2000 LUNCH

3. Ryan Sykes • Regional Director  Northeast Region I am located in Syracuse, New York I started as an Agent at age 21 I am Regional Director for the 14 Northeast States “ In my opinion, our lead support as well as our Renewal structure sets us apart from all others” 518.764.2286 rcsykes@torchmarkcorp.com

4. Focus of this meeting • Who we are • The New Medicare Landscape • Medicare Advantage (MA) and Medicare Supplement (Med-Supp) • Explanation of the Senior Market and why Medicare Supplements offer the MOST growth opportunity in the most stable market • Why the HDF is the “Thinking person’s policy” • Products • Introductory offers- New ADP • Leads… Leads… And even more Leads… • Renewals

5. Company History Introduction Industry Ratings United American A+ (Superior) Financial Strength Rating from A.M. Best Company for more than 30 consecutive years (as of 6/11) AA- “Very Strong” Financial Strength Rating from Standard & Poor’s (as of 5/11) First United American A+ (Superior) Financial Strength Rating from A.M. Best Company for more than 20 consecutive years (as of 6/11) • United American opened its doors in 1947. • We gained recognition as one of the nation's leading writers of individual Medicare Supplements. • Source: NAIC 2010 Medicare Supplement Insurance Experience Report, June 2011

6. Service Performance Record Our 2010 Service Performance Record speaks for itself (United American company data)

7. The New Medicare Landscape

8. New Medicare Landscape Which of the following products have you sold in the last 12 months? Source: Agent’s Sales Journal, June 2011

9. New Medicare Landscape • The Affordable Care Act continues to be implemented bit by bit • Agents are being forced to shift their market focus • Products like Medigap’s (55%) are receiving increased attention as agents expand their product lines. • “I plan to move into the Medicare supplement business [in the next 12 months] and hope to establish an ‘Obamaproof’ market for my business,” said an independent agent from Plano, Texas who saw business decrease in the past year. Source: Agent’s Sales Journal, June 2011

10. Medicare Reform: The Next Three Years 2012 • Reduce rebates for Medicare Advantage plans • Provide bonus payments to high-quality Medicare Advantage plans • Create the Medicare Independence at Home demonstration program 2013 • Begin phasing in federal subsidies for brand-name prescriptions filled in the Medicare Part D coverage gap • Establish a national Medicare pilot program Source: Agent’s Sales Journal, August 2010

11. Medicare Reform: The Next Three Years 2014 • Reduce the out-of-pocket amount that qualifies an enrollee for catastrophic coverage in Medicare Part D • Reduce Medicare Disproportionate Share Hospital (DSH) payments by 75% • Require Medicare Advantage plans to have medical loss ratio no lower than 85% Source: Agent’s Sales Journal, August 2010

12. Medicare.gov

13. Medicare Enrollment • All Seniors are eligible to enroll in Medicare Part A when they turn 65. Enrollment is automatic through Social Security and premium-free for most people. • Enrollment in Medicare Part B is optional and requires a monthly premium of $115.40 (Income based), which is deducted from your Social Security check. • Parts A and B will cover many of the hospital and medical expenses, but not all of them. A Medicare Supplement can help you cover the deductibles, coinsurance, copayments, and even the excess charges that Medicare doesn't cover. • Prospects must be enrolled to Medicare Parts A and B to be eligible for a Medicare Supplement policy. Source: Medicare.gov

14. Medicare A/B Chart

15. Medicare Facts Every day, more than 10,000 boomers will turn 65 in 2011 This exceeds 3.6 millionseniors Source: Pew Research Center, December 2010

16. WHAT ARE THE COVERAGE OPTIONS Medicare Advantage (MA) and Medicare Supplement (Med-Supp) Insurance ?

17. MA = Medicare Advantage Plan (Part C) • Offered by private companies – provides Part A & B benefits • Three types of Medicare Advantage Plans: • Health Maintenance Organization (HMO) • Preferred Provider Organization (PPO) • Private Fee-For-Service (PFFS) • Must cover Medicare Part A and B services, but not structured the same as Medicare Supplements • Medicare Advantage Plans can change the Senior’s benefits • Doctors can opt out at anytime • Not guaranteed renewable

18. Medicare Advantage Plans • In 2010, more than 636,000 Seniors were canceled by their Medicare Advantage providers • In 2011, almost 700,000 Seniors were canceled by their Medicare Advantage providers • Over 200,000 Seniors have been cancelled going into 2012 • That’s Over 1.5 MILLION Seniors cancelled in the last three years from MA Plans!

19. 2010 vs. 2011 Benefit Reduction This example taken from one of the nation’s top Medicare Advantage insurers Source: Medicare.gov

20. Other Out-of-pocket Costs Include • Hospital Stay • Office Visits • X-rays • Lab Work • Ambulance • ER Visits • 20% Copay • Durable Medical Equipment • Medical Supplies • Out-of-network fees • Radiology • Skilled Nursing • Outpatient Surgery • Diabetes Supplies

21. Medicare Advantage Good Health vs. Health Conditions (Ages 65-69 in Texas) Up to 61% increase! Source: Medicare.gov

22. Sense of Urgency

23. Why Med-Supps offer the most growth

24. How Do You Compete? United American’s Med-Supp Plans: • Are guaranteed renewable for life! • Allow seniors to choose any doctor, hospital or specialist they wish • Stable rates • Coverage is the same anywhere in U.S.

25. Medicare Supplement Open Enrollment Medicare Supplement policies are guaranteed issue during open enrollment periods; the applicant cannot be turned down for health conditions. A person is eligible for an open enrollment: • For 6 months following initial Medicare Part B enrollment at age 65 or older. • Open enrollment applies in some states to those under age 65 enrolled in Medicare due to disability. • Applications can be taken up to 6 months before the prospect’s open enrollment There are also times that a person can join Med Sups without health questions when they are coming off a Med Advantage program or employer group coverage Also keep in mind there are also some other state specific times of guaranteed enrollment

26. 5 Keys to Selling MA Disenrollees

27. New Medicare Landscape How to Grow Your Medicare Business When you sell based on price, all you’re doing is churning your business Source: Agent’s Sales Journal, October 2010

28. How to Grow Your Medicare Business Sell the Right Plan the First Time • Two Thirds of Seniors have middle to High Incomes… • Seniors want value, not the cheapest plan! • Is the customer comfortable with cost-sharing or do they prefer insurance that covers everything? • How healthy does the customer expect to be in 5, 10, or 15 years? • Does the customer have any chronic conditions? • Give your opinion!

29. What We Offer Our Producers and Policyholders today! • ProCare available in all states except: MA, MN, NH, and NJ • MC4810 Medicare Supplement in WI

30. UA Policies Issued in 2010 82.8% of our Medicare Supplement policies sold in 2010 were Plan F or Plan HDF Source: Company Statistics, as of 12/2010

31. Overview of Plan F Plan F • Foreign Travel Emergency – • Pays 80% after $250 deductible #1 Selling Medicare Supplement Nationwide! #1 Selling Medicare Supplement Nationwide!

32. Premium Savings Q:How do people save money on any kind of insurance (health, car, homeowners)? A:They raise their deductible … And Save $$$$$$$$

33. Overview of High Deductible Plan F (HDF/F+) Plan HDF/F+ subject to a Calendar-year Deductible High Deductible Plan F (HDF/F+) • High Deductible Plan F benefits begin after out-of-pocket expenses exceed calendar year deductible • $2,000 in 2011 • $2,070 in 2012 • Medicare pays its portion whether or not the policyholder has met the Calendar-year deductible for Plan HDF/F+ • Second most popular plan • Fastest growing plan • Lowest Price Point

34. History of HDF • Designed to address Seniors’ concerns of higher premiums • Great choice for seniors who are relatively healthy and can afford to pay out-of-pocket deductible • Per the Centers for Medicare & Medicaid Services (CMS), the annual HDF deductible may or may not increase. Adjustments in the HDF annual deductible amount is subject to the release of the Consumer Price Index (CPI) which generally occurs in October of each year. • HDF deductible (co-pay) is $2,000 in 2011 – it has been the same amount since 2009 – increases to $2,070 in 2012

35. Medicare Annual HDF/F+ Deductible Sales of High Deductible Plan F began in 2005

36. Review

37. HDF Claim Example • Lisa has an HDF policy • What happens when she has a Part B claim? Total approved Part B Doctor Claim $100 Medicare’s 80% of Approved Charge $80 Customer’s 20% of Approved Charge $20 If deductible is reached then senior owes $0 * * Policyholder must meet HDF calendar-year deductible ($2,000 in 2011) before benefits begin, and pay their HDF premiums.

38. Sample Med-Supp HDF/F+ Rates The sample Medicare Supplement Plan HDF rates shown below are for a nonsmoker female, age 65. Rates shown are effective [March 1, 2011]. Rates are subject to change and may vary according to area and smoker/nonsmoker status.

39. Premium Savings Example Agents can help Seniors understand how HDF may be suitable coverage for their health needs AND budget NATIONAL AVERAGE $ 155 Brand X Plan F monthly premium - $ 41 * Our Plan HDF monthly premium $ 114 Monthly Premium Savings × 12 Months $ 1,368 Annual Premium Saved ** × 10 Years $ 13,680 10 Year Premium Saved * UA ProCare, National Average, Age 65 Female, Nonsmoker ** Example assumes no rate increases on either plan; policyholder must meet HDF calendar-year deductible ($2,000 in 2011) before benefits begin For illustrative purposes only

40. Life Expectancy/Renewals - Total Income Would you pay $1,368 per year to cover a possible loss of $2,070? Average Annual Claims Loss considering all ages is only $620!

41. Claims Data 80% of United American’s Medicare Supplement population up to age 68 has annual claims above Original Medicare of $534 on average 78% of our Company’s Medicare Supplement population up to age 72, has annual claims above Original Medicare of $621 or less on average 71% of our Company’s Medicare Supplement population age 73 or older, has annual claims above Original Medicare of $707 or less on average Source: United American 2009 Claims data

42. Average Claim Cost 77.2% of the time, this is what a client will pay over a 10 year period $ 13,680 Savings over 10 years $ 6,121 Spent on claims $ 7,559 Net Saving over 10 years 77.2% of the time $ 755 Per year Average Savings Source: United American 2009 Claims data

43. Saving Premium Over Time Example assumes no rate increase and no increase in the HDF calendar-year deductible

44. HDF $1,000 Deductible Waiver Post Card • Helps write new business and maintain high persistency • Valid for new HDF policies effective Oct. 1-Dec. 31 • Policyholders only required to pay $1,000 out-of-pocket before benefits are payable by UA • Policyholders required to meet full annual deductible beginning Jan. 1, 2012 • Not available for First UA

45. Five Great Options for Annual Premium Savings $ 155 Brand X Plan F Monthly Premium - $ 41 Plan HDF Monthly Premium $ 114 Monthly Premium Savings with HDF • Cancer Insurance • Hospital Indemnity Insurance • Life Insurance • Lifestyle Annuity • Reserve Fund Annuity Products and Benefits vary by state

46. RESERVE FUND ANNUITY UA offers a unique product – RFA assists Med-Supp policyholders with paying HDF calendar-year deductible or copayment RFA’s interest rate is guaranteed at 3% No charge to open, no lock-in time for deposits, no surrender charges, and no commission loads Open with as little as $50 and can deposit up to $4,000 per year Can be added to Plans A, B, D, HDF, G, K and L Not Available in NY and VT

47. Three Interest Rate Examples * Accumulating monthly (compounded annual yield)

48. What We Offer Our Producers and Policyholders today! Lifestyle Single Premium Annuity • Minimum 3% Interest • Withdrawal Charges Eliminated after Year 6 • Deposit • Minimum $5,000 • Maximum $20,000 • Issue Ages • 0-80 • Hospitalization and Nursing Home Waiver of Withdrawal available in most states • Not available in: • CO, MA, or NY

49. What We Offer Our Producers and Policyholders today! Flexible Premium Annuity • Minimum 3% Interest • Withdrawal Charges Eliminated after Year 6 • Deposit Minimum • Initial $2,000 • Additional $50 • Deposit Maximum per Annuitant • Per Year $20,000 • Issue Ages • 0-85 • Hospitalization and Nursing Home Waiver of Withdrawal available • Available in: • NY

50. What We Offer Our Producers and Policyholders today! Cash Cancer • First Diagnosis, Lump-Sum Benefit - $10,000- $50,000 • $10,000-$30,000 in GA • Issue Ages 0-69 • 0-64 in CA • High Commissions and Renewals paid for the life of the policy. • Yes/No Applications • Not available in: • CT, MA, MN, NJ, NY, or SD