PART 1: General Market Explanation

PART 2: UA Coverage Solutions

Form UASM-1 R02

2002 Agent Training Presentation

Part 1: General Market Explanation

Medicare Review

Medicare Supplement

Long Term Care

Life Insurance

Insurer Selection

In 1966 the Federal government started this hospital/medical insurance program to help protect persons age 65 and over.

In year 2000, 13% of the US population was over 65 and Medicare eligible. — Administration on Aging; www.aoa.dhhs.gov, August 1999.

Medicare Overview

By the year 2030, Medicare will pay for the health care of nearly 20% of the population. Rethinking Medicare by Tom Curry, MSNBC; www.msnbc.com/news/136650.asp May 2, 2000.

Medicare consists of two parts — A & B:

Medicare Today

Medicare Part A Hospital Room & Board. Other Costs Associated

with Confinement. Skilled Care in a Nursing

Facility.

Medicare Part B Medical insurance

MEDICARE PART A — HOSPITAL

MEDICARE PAYS: YOU PAY:

Medicare Today

2002 Deductible: Most confinement $812 per costs after deductible confinement

Days 61-90: All eligible $203 Daily remaining expenses

Days 91-150: All eligible $406 Daily remaining expenses

Days 151 on: Nothing All hospital costs

MEDICARE PART A — Skilled Nursing Facility

MEDICARE PAYS: YOU PAY:

Medicare Today

Days 1-20: All eligible Nothing expenses after

leaving the hospital — specific limitations

Days 21-100: All eligible $101.50 Daily remaining expenses

Days 101 on: Nothing All costs

MEDICARE PART B — MEDICALPart B covers: Doctor & surgeon fees, most lab tests & X-rays performed outside the hospital and outpatient treatment.

Medicare Today

MEDICARE PAYS

--

generally pays 80% of “approved”charges

--

YOU PAY

$100 annual deductible

20% of “approved” charges

100% of charges above Medicare “approved” amounts

PART A — HOSPITAL INSURANCE 1st DAY 61st-90th DAY 60 DAY 21st-100th DAY YEAR BENEFIT INPATIENT HOSPITAL INPATIENT HOSPITALLIFETIME RESERVE SKILLED NURSING PERIOD BEGAN DEDUCTIBLE COINSURANCE COINSURANCE FACILITY COINSURANCE

PART B — MEDICAL INSURANCEANNUAL DEDUCTIBLE COINSURANCE

COVERED SERVICES COVERED SERVICES

1966-1972 $50.00 20% of Approved Amount 1973-1981 $60.00 20% of Approved Amount 1982-1990 $75.00 20% of Approved Amount 1991-Now $100.00 20% of Approved Amount

1966 $ 40.00 $ 10.00 $ 20.00 $ 5.001970 52.00 13.00 26.00 6.501980 180.00 45.00 90.00 22.501990 592.00 148.00 296.00 74.00

1995 716.00 179.00 358.00 89.501996 736.00 184.00 368.00 92.001997 760.00 190.00 380.00 95.001998 764.00 191.00 382.00 95.501999 768.00 192.00 384.00 96.002000 776.00 194.00 388.00 97.00

2001 792.00 198.00 396.00 99.002002 $812.00 $203.00 $406.00 $101.50

per benefit period per day per day per day

Plans A B C D E F G H I JCore Benefits Skilled Nursing Home Part A Hospital Deductible Part B Deductible Excess Doctor Charges 100% 80% 100% 100%

Foreign Travel At-Home Recovery Prescription Drugs $1250 $1250$3000

Preventive Care *Plans F & J are also high deductible plans.

Standardized Med-Supp Plans

Hypothetical Example: Patient Liability after MedicareNeed for Medicare Supplement

PATIENT PLAN C PLAN F PLAN GLIABILITY PAYS PAYS PAYS

PART A: HospitalPart A Deductible $ 812 $ 812 $ 812$ 81230 Days @ $203 6,090 6,090 6,090 6,09060 Days @ $406 24,360 24,360 24,360 24,360Additional Hospitalization 20,000 20,000 20,000 20,0003 units of blood @ $60 180 180 180 180

SUBTOTAL: $51,442 $51,442 $51,442 $51,442

SNF: 80 Days @ $101.50 8,120 8,120 8,120 8,120

At-Home Recovery: 14 visits @ $40 560 — —

560PART A TOTAL: $60,122 $59,562 $59,562$60,122

PART B: Outpatient Hospital Services & Medical

PART B TOTAL: $12,591 $8,325 $12,591$11,638

$72,713UNPAID

$67,887

$72,153

$71,760 Plans covering excess charges are not

applicable in PA and OH.

Insurance companies receive eligible Medicare Part B claims automatically from Medicare Part B administrators.

Automatic filing virtually eliminates the need for customer claims filing.

Not all Medicare Supplement insurers offer automatic filing.

Companies offering automatic filing sometimes provide it only in limited areas.

Federal law requires Medicare to file a small number of claims directly with insurers.

Automatic Claims Filing

1. Can patients pick their primary-care physician?

2. What gets covered? Pre-existing conditions? Emergency-room visits?

3. How much will it really cost? Are there co-payments on prescriptions, routine doctor appointments and visits to specialists?

4. What if a patient wants to see someone not included in the plan?

Managed Care ‘Freedom’?

Questions Seniors should research in the case of HMOs:

5. How good are the HMO doctors? How many are board-certified?

6. Does the patient have access to any doctor in the HMO plan?

7. How convenient are the locations of HMO facilities and physicians?

8. What do current patients think of the HMO?

Managed Care ‘Freedom’?

Questions Seniors should research in the case of HMOs: (continued)

Initial Medicare Supplement policy selection is more critical than customers may realize.

Only policies are standardized, companies are not.

“First Year” Choices

Choose a safe, strong, proven company — once.

Research, understand and choose the best coverage for you — once.

Qualify for coverage — once. Health status can change and qualifying for a different policy (an upgrade) may not be possible later.

36% of all 65 year old men and 50% of all 65 year old women will eventually require nursing home care.- Long Term Care Planning, A Dollar and Sense Guide, 2001.

The average cost of a nursing home stay in 1990 was about $72 a day. - Who Buys Long Term Care Insurance? 1994-95 Profiles & Innovations in a Dynamic Market, HIAA

This figure has now risen to a cost ranging from $85-178 per day, depending on location.- University of Maryland Center on Aging Partnership for Long Term Care, updated 8/7/01.

Long Term Care Need

Life insurance is purchased mainly to buy additional financial protection for families.

Most policies sold cover people age 0-80.

Life Coverage

Ordinary life is the most widely used form of life insurance protection and it is broken into two types . . . whole life (permanent) and term insurance.

The most common minimum amount of an individual policy is $10,000.

When a loved one dies many bills may remain and the family will need to find the money to pay them. Life insurance coverage bought now can help to cover these costs.

Life Coverage

This type of Life insurance is generally for ages 50-80

Provides quick access to pay final expense costs

Protects loved ones from financial burden during a difficult time

Options can include varying face amounts, cash and loan values and living benefits

(continued)

Most annuities are available for ages 0-80.

Annuities are purchased for the purpose of producing periodic income at regular intervals for a specific time frame, such as 10, 20, 30 years or even life.

Annuities

Annuities help assure protection against the possibility of outliving one’s financial resources.

Typically annuities are intended to provide additional retirement income.

Choose the right company.

Examine the company behind the product . . .

financial stability, leadership experience, industry ratings and rankings.

Life/Health Insurer Selection

Match coverage needs to budget.

The bottom line . . . what good is an insurer if you can’t depend on them when you need protection?

Medicare Supplement

Long Term Care

Cancer

Life Coverages

United American Review

Part 2: UA Coverage Solutions

Source: HIAA Source Book of Health Insurance Data, 2000

Growth in the Medicare Supplement Market

93.185.8

75.2

60.6

34 35.3

0

20

40

60

80

100

1995 2000 2005 2050 2075 2100

Million

sPredicted Number of People Age 65

Growth in the Medicare Supplement Market

in 2000, the number of Medicare beneficiaries was approximately 40 million. The number of Medicare beneficiaries is expected to increase 77% during 2000-2025 to an estimated 75 million.

Annual out-of-pocket spending for elderly Medicare beneficiaries is expected to climb from $3,142 in 2000 to $5,248 in 2025.

Source: www.urban.org/health/growth-in-medicare.html

Policy Forms MSA MSB* MSC MSD MSFMSG

Core Benefits

Skilled Nursing Home

Part A Hospital Deductible

Part B Deductible Excess Doctor Charges 100% 80%

Foreign Travel

At-Home Recovery There are ten standardized Medicare Supplement insurance plans; of these, United American offers six.*Plan B provides both senior and underage disability protection. Benefits are identical (separate app/brochures); senior rates are age-banded and Underage Disability rates remain one rate all ages. (Some states require designated Medicare Supplement plans be available to persons eligible for Medicare due to disability.) Excess charges are not applicable in PA and Ohio. Plans F and G not available in PA and VT. Plans and benefits may vary by state. United American Insurance Company is not associated with or endorsed by Medicare, Social Security or any other governmental agency.

UA’s ProCare Med-Supp Portfolio

Groups of 50 or more retired employees are eligible — including eligible spouses.

100% participation is required.

Coverage is guaranteed issue.

Lower, community rates will be offered.

The full UA ProCare portfolio is available.

United American’s ultimate customer service, “Automatic” Claims Filing PLUS® (ACF PLUS®) is available throughout the Country (except in MA).

UA Group Medicare Supplements

United American delivers . . .

UA Policyholder Services

Personal one-on-one Agent attention. Fast policy issue for fast protection. Automatic Payment Plan (Bank Draft) for

premium payment, thereby eliminating unintentional lapse and providing non-stop protection.

Easy-to-understand product brochures with clearly defined benefit descriptions.

ACF Partners®, which provides automatic filing (ACF PLUS®) of Medicare Part B claims and also includes discount health services. (ACF Partners not available in Connecticut, Kansas, Minnesota or Montana.)

Nationwide discount health services program with savings for:

Chiropractic

Dental

Eye Care

Hearing Aids

Prescriptions

Mail OrderPharmacy 0% 10% 20% 30% 40% 50%

ACF Partners®

Up to 40%

Up to 50%

Up to 50%

Up to 20%

Up to 30%

Save More $$

PLUS, “Automatic” Claims Filing:

Virtually eliminates claims filing

Direct provider payment

Speeds claims processing

Consolidated monthly claim statements

Note: Federal law requires Medicare to file a small number of claims directly with insurers.

ACF Partners®

ACF Partners

AK

OR

NV

AZ

TXLA

AR

MOKS

NEIA

MS AL GA

FL

IL INOH

KY

WVVA

PA

HI

CT

NJ

DE

DC

ACF Partners/ACF PLUS not available in MA and NY.

MD

WI

CA

ID

MT

WY

WA

UT CO

NMOK

SD

ND

MN

TNSC

NC

MI

NH

VTME

RI

ACF PLUS available

ACF Partners®

Dear Sirs,Thank you so much for the Partners membership card* for the discount benefit program. I have used the card several times, and it is hard to believe how much I have saved on prescriptions. It is well worth the fee. I recommend the company (United American) to friends and relatives as often as I have the opportunity.

Sincerely,E. Clark, Georgia

Policyholder Praise

Dear United American,I have been on Medicare and United American insurance for six months now. I am writing to inform you that, thanks to your agent in this area I chose your company. The service has been excellent and payments prompt. I will recommend your company to anyone who is 65 and anyone else who will listen.Again thanks.P.S. I save about 45 to 50% on drugs with the ACF Partners card*.

Thanks again,J. Clemens, IA

Policyholder Praise

Dear Sir,

Thank you for being such a good insurance company. Whenever anyone asks, “What insurance do you have?” and I tell them United American, they immediately say, “well then, everything will be taken care of.” And it is. I never have a worry about a thing.

Sincerely,M. Fry., CO

Policyholder Praise

Dear Madam,I have been with you about 8 years and in that time I have never had a problem. As a matter of fact many times evidence of your payment (monthly statement) comes before the EOMB from Medicare.

C. Cherney, North Carolina

Policyholder Praise

Mr. Mark McAndrew,Just a short note to thank you and your people for 16 years of wonderful, prompt service - never a problem.

Yours truly,O. and J. Yonkers, New Hampshire

To: webmaster@torchmarkcorp.com

Subject: A thanks

This may be a strange e-mail but as I was working around the house the other day, your TV ad came on and I just wanted to thank you for the great way this insurance company took care of my parents . . . my father and then my mother signed up with UA and recommended many others to this company, so I just wanted to say thanks and I will look into UA when I am ready for a supplemental coverage!!

Sincerely,

K. Rich, Florida

Policyholder Praise

LTC Classic — Indemnity

LTC Gold Series — Expense-Incurred

Individual or Married Protection

Issue Ages 40-84

Long Term Care Plans*

*Plans and benefits may vary by state

The Classic and Gold Series Plans offer these additional features:

LTC Features

Benefits for Alzheimer’s Disease — covers as any other sickness*

Cognitive Impairment Lapse Protection Third Party Notification Guaranteed Renewable Protection Automatic Payment Plan Married couple rate

*In most states, Alzheimer’s must be first diagnosed or treated after the policy is in force.

Choice of Daily Benefit Amount: $30 - $200

Choice of Benefit Periods: 1 year, 2 years, 4 years or Unlimited

Choice of Elimination Periods: 0, 30, 100, 180 days

Qualified Nursing Home Coverage for skilled, intermediate & custodial care

Bed Reservation Benefit

Restoration of Benefit

Waiver of Premium

Optional Benefit Inflation Rider

Optional Non-forfeiture Benefit Rider

LTC Classic

Plans & benefits may vary by state.Policy Form LTCIN

Choice of Daily Benefit Amount: $30 - $200

Choice of Benefit Factors (or Maximum Benefit): 365 days, 730 days, 1460 days or Unlimited*

Choice of Elimination Periods: 0, 30, 100, 180 days

Qualified Nursing Home covers all levels of care: skilled, intermediate & custodial care

Alternative Plan of Care Benefit

Bed Reservation benefit

Restoration of Benefit

Waiver of Premium

*Unlimited not available on HHC or HHCC Riders. Plans & benefits may vary by state.

Policy Form LTCBOM

LTC Gold Series

Optional Riders:

LTC Gold Series

Plans & benefits may vary by state.

Home Health Care

Home Health and Community-Based Care with:• Alternative Care• Hospice Care• Adult Day Care• Respite Care

Benefit Inflation Rider

Non-Forfeiture Benefit (where approved)

Miscellaneous Hospital Benefit:

Good Sense Plan

Plans & benefits may vary by state.Policy Form GSP1

Issue ages 0-63 Benefit amounts of $15,000 or $25,000

(less $500 deductible) Surgical Expense Benefit Radiotherapy Benefit Choice of Daily Hospital Room Benefit Daily Intensive Care Benefit – up to two

times the daily room benefit

UA Cash Benefit Cancer Plan

This is a supplemental cancer only insurance policy. Policy Form CANB

Reasons To Buy UA’s Supplemental Cancer Coverage:

Reason #1Freedom To Choose How Money Is Spent

No restrictions on the way the policyholder spends the benefit amount received . . . reconstructive surgery, choice of treatment plan or doctor, mortgage payments, travel expenses, income while not working, etc. It’s up to the policyholder to decide how best to spend the money.

UA Cash Benefit Cancer Plan

Reasons To Buy UA’s Supplemental Cancer Coverage:

Reason #2Existing Coverage Doesn’t Matter

Fact: The lump sum cash benefit amount is designed as a total cash payment. This frees the customer from having to forfeit any existing coverage. With UA’s Cash Benefit Cancer Plan there is no duplication of coverage.

This is a supplemental cancer only insurance policy. Policy Form CANB

Reasons To Buy UA’s Supplemental Cancer Coverage:

Reason #3Liberal Qualification

No physical exam is required to qualify — a few health questions will determine if you qualify for coverage.

UA Cash Benefit Cancer Plan

This is a supplemental cancer only insurance policy. Policy Form CANB

First diagnosis, cash benefit supplemental cancer policy

Pays one-time cash payment of up to $10,000, $20,000, $30,000, $40,000, $50,000

Benefit payment upon written satisfactory proof according to the policy of diagnosed internal cancer or malignant melanoma

Coverage for Individual, Single Parent and Family — issue ages 0-69

Policy pays in addition to any other existing coverage

No hospitalization or treatment required to collect the full benefit amount due

This is a supplemental cancer only insurance policy. Plan and benefits may vary by state.

Policy Form CANB

UA Cash Benefit Cancer Plan

Whole Life — Level or Increasing

RT85 Renewable Term Life

Joint Last Survivor

21-Pay

UA Life Plans*

*Plans and benefits may vary by state

Ages 45-80 Level Benefit with 4 Payment Options

- 10 Year Pay - 20 Year Pay- 15 Year Pay - Ordinary Life

Graded Benefit— Offered where approved.**- Available on level and increasing benefit

choices Increasing Benefit — Grows 5% each policy

year for 20 years until it doubles.- Ordinary Life payment option only

Living Benefit— Offered where approved.

Whole Life*

Policy Forms SWL & SWLGD *Plan and benefits may vary by state

**Graded Benefit not approved in MA, MN, NC, NJ, PA, SC and WA.

Ideal protection for families just starting out and for those who need additional insurance coverage.

* Plan and benefits may vary by state. Policy Form RT10** Graded Benefit not approved in MA, MN, NC, NJ, PA, SC &

WA.

RT85 Renewable Term Life*

Available ages 18-85

Immediate coverage with policy issue

Graded Benefit - offered where approved

Cash Benefit paid directly to beneficiary

Living Benefit (where approved)

Whole Life, coverage for couples — Ages 45-80

Plan and benefits may vary by state

Policy Form JSWL

Joint Last Survivor

Level Benefit with 4 Payment Options- 10 Year Pay - 20 Year

Pay- 15 Year Pay - Ordinary Life

Increasing Benefit — Grows 5% each policy year for 20 years until it doubles. Ordinary Life payment option only.

Offers Living Benefit where approved Beneficiary receives policy benefit upon

death of survivor No premium increases ever

“Special needs” life insurance coverage from birth.

Plan and benefits may vary by state.Policy Form URL-CBP

21-Pay Life Plan

Available ages 0-79

Coverage for individuals, families and seniors

Face amount increases 5% per year

Optional child and Accidental Death Benefit Riders (Additional premium applies.)

United American will provide a complimentary Memorial Guide to each current or prospective policyholder.

The Memorial Guide documents important information that aids families in making final preparations: vital statistics, military record, immediate family and special requests.

This Guide allows seniors to assess their final expense needs and their level of preparation.

Memorial Guide

Issue ages 0-80

Single Premium

Tax-deferred growth

Guaranteed interest rate at all times

Optional maturity date

5 income options include monthly checks

Plan may vary by state.Policy Form USPDA

UA Lifestyle Annuity

1.Over 50 years of Life/Health insurance experience2.Full range of Life and Health products —Medicare Supplement, Long Term Care, Cancer, Life (whole life, term, annuities)3.One of the largest writers of individual Medicare Supplements (NAIC Final Med-Supp Experience Report 2/01)

4.Personal Agent service5.Fast policy issue for fast protection6.UA average Medicare turnaround times: claims processing — 3.56 days. 7. Timely policyholder communications8.Freedom to choose physicians & facilities on all health coverage 9. Simple “Yes/No” applications10. ACF Partners® : discount health services program with “Automatic” Claims Filing

10 GREAT REASONS TO BUY UA COVERAGES

United American Review

United American Insurance Company is not associated with or endorsed by Medicare, Social Security or any other governmental agency.

Unless specified, these Medicare Supplement policies will not duplicate Medicare payments or pay expenses not Medicare eligible.

These policies described herein have exclusions and limitations. This is a solicitation for insurance, and an agent representing United American Insurance Company may call you to provide costs and complete details.

Pre-existing condition means an injury sustained or sickness manifesting itself prior to the policy effective date.

Form UASM -1 R02

UNITED AMERICAN SECURITY FOR TODAY AND TOMORROW

United American Insurance Company HeadquartersMcKinney, Texas