YEAR END ACTUARIAL APPRAISAL

OF

CONGLOMERATE INSURANCE HOLDINGS INC.

INDEX

INTRODUCTION

  Assignment Parameters

  Description of Companies
  Balance Sheets
  Existing Portfolios

EXPENSE REVIEW

  Industry Norms
  Analysis for Companies

NEW BUSINESS PLAN

  Market Presence
  Observed Trends

ACTUARIAL BASIS AND
MODELING TECHNIQUES

  Cash Flow Models
  Modeling Horizon

GENERAL ACTUARIAL
ASSUMPTIONS

  Mortality
  Withdrawals
  Morbidity
  Expenses
  Spreads

HARVESTING ACTIVITY

1

2

3
5
9

15

22
26

26

28
30

30


36
39

39


39
40
42
45
47

48

ANTI-SELECTIVE WITHDRAWALS

TAXES

PORTFOLIO SPECIFIC ASSUMPTIONS

  Life Insurance
  Annuity Business
  Variable Annuity Business
  Health Business

RESULTS OF CALCULATIONS
PER COMPANY

  Surplus
  Value of Existing Portfolio
  Value of New Business Plan
  Surplus Notes

NET APPRAISED VALUE

APPROXIMATE
RECONCILIATION TO GAAP

CASHFLOW AND
ABILITY TO SERVICE DEBT

DISCUSSION

EXHIBITS

  Exhibit A: Balance Sheets
  Exhibit B: Summaries of Operations
  Exhibit C: Cash Flow
  Exhibit D: Value Exhibit

50

51

52

52
53
54
55

56


57
59
61
63

65

69


74


77