ANNUAL STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2016 OF THE CONDITION AND AFFAIRS OF THE AMICA LIFE INSURANCE COMPANY

Transcription

1 LIFE AND ACCIDENT AND HEALTH COMPANIES - ASSOCIATION EDITION ANNUAL STATEMENT FOR THE YEAR ENDED DECEMBER 3, 06 OF THE CONDITION AND AFFAIRS OF THE AMICA LIFE INSURANCE COMPANY * * NAIC Group Code NAIC Company Code 7 Employer's ID Number (Current) (Prior) Organized under the Laws of Rhode Island, State of Domicile or Port of Entry RI Country of Domicile United States of America Incorporated/Organized 06/3/968 Commenced Business 05/06/970 Statutory Home Office 00 Amica Way, Lincoln, RI, US (Street and Number) (City or Town, State, Country and Zip Code) Main Administrative Office 00 Amica Way (Street and Number) Lincoln, RI, US , (City or Town, State, Country and Zip Code) (Area Code) (Telephone Number) Mail Address P.O. Box 6008, Providence, RI, US (Street and Number or P.O. Box) (City or Town, State, Country and Zip Code) Primary Location of Books and Records 00 Amica Way (Street and Number) Lincoln, RI, US , (City or Town, State, Country and Zip Code) (Area Code) (Telephone Number) Internet Website Address Statutory Statement Contact David Joseph Macedo, (Name) (Area Code) (Telephone Number) dmacedo@amica.com, ( Address) (FAX Number) Chairman, President and Chief Executive Officer Robert Anthony DiMuccio OFFICERS Senior Vice President, Chief Financial Officer and Treasurer James Parker Loring Senior Assistant Vice President and Secretary Suzanne Ellen Casey Actuary Ernst & Young LLP Robert Karl Benson, Senior Vice President & Chief Investment Officer OTHER Edmund Shallcross III, #, Senior Vice President & General Manager Robert Paul Suglia, Senior Vice President & General Counsel DIRECTORS OR TRUSTEES Jeffrey Paul Aiken Jill Janice Avery Debra Ann Canales Patricia Walsh Chadwick Edward Francis DeGraan Robert Anthony DiMuccio Barry George Hittner Michael David Jeans Ronald Keith Machtley Richard Alan Plotkin Donald Julian Reaves Cheryl Watkins Snead State of County of Rhode Island Providence SS: The officers of this reporting entity being duly sworn, each depose and say that they are the described officers of said reporting entity, and that on the reporting period stated above, all of the herein described assets were the absolute property of the said reporting entity, free and clear from any liens or claims thereon, except as herein stated, and that this statement, together with related exhibits, schedules and explanations therein contained, annexed or referred to, is a full and true statement of all the assets and liabilities and of the condition and affairs of the said reporting entity as of the reporting period stated above, and of its income and deductions therefrom for the period ended, and have been completed in accordance with the NAIC Annual Statement Instructions and Accounting Practices and Procedures manual except to the extent that: () state law may differ; or, () that state rules or regulations require differences in reporting not related to accounting practices and procedures, according to the best of their information, knowledge and belief, respectively. Furthermore, the scope of this attestation by the described officers also includes the related corresponding electronic filing with the NAIC, when required, that is an exact copy (except for formatting differences due to electronic filing) of the enclosed statement. The electronic filing may be requested by various regulators in lieu of or in addition to the enclosed statement. Robert Anthony DiMuccio Suzanne Ellen Casey James Parker Loring Chairman, President and Chief Executive Officer Senior Assistant Vice President and Secretary Senior Vice President, Chief Financial Officer and Treasurer a. Is this an original filing? Yes [ X ] No [ ] Subscribed and sworn to before me this b. If no, 8th day of February, 07. State the amendment number. Date filed 3. Number of pages attached Ann Marie Octeau Notary Public June 8, 08

2 ASSETS Assets Current Year Nonadmitted Assets 3 Net Admitted Assets (Cols. - ) Prior Year 4 Net Admitted Assets. Bonds (Schedule D) 99,804,334 99,804,334,00,54,06. Stocks (Schedule D):. Preferred stocks. Common stocks 48,897,069 48,897,069 47,703, Mortgage loans on real estate (Schedule B): 3. First liens 8,949,47 8,949,47 5,080,90 3. Other than first liens 4. Real estate (Schedule A): 4. Properties occupied by the company (less $ encumbrances) 4. Properties held for the production of income (less $ encumbrances) 4.3 Properties held for sale (less $ encumbrances) 5. Cash ($ 4,88,050, Schedule E - Part ), cash equivalents ($, Schedule E - Part ) and short-term investments ($ 44,34,37, Schedule DA) 59,3,87 59,3,87 50,047,07 6. Contract loans (including $ premium notes) 7,869,86 7,869,86 7,770, Derivatives (Schedule DB) 8. Other invested assets (Schedule BA) 38,588,083 38,588,083 9,07, Receivables for securities 759, , Securities lending reinvested collateral assets (Schedule DL). Aggregate write-ins for invested assets. Subtotals, cash and invested assets (Lines to ),67,000,67,67,000,67,50,60,54 3. Title plants less $ charged off (for Title insurers only) 4. Investment income due and accrued 8,406,77 8,406,77 8,84, Premiums and considerations: 5. Uncollected premiums and agents' balances in the course of collection (3,003,573) (3,003,573) (3,90,90) 5. Deferred premiums and agents' balances and installments booked but deferred and not yet due (including $ earned but unbilled premiums) 3,84,760 3,84,760 30,857,5 5.3 Accrued retrospective premiums ($ ) and 6. Reinsurance: contracts subject to redetermination ($ ) 6. Amounts recoverable from reinsurers 68,075 68,075,563, Funds held by or deposited with reinsured companies 6.3 Other amounts receivable under reinsurance contracts,55,05,55,05,6,67 7. Amounts receivable relating to uninsured plans 8. Current federal and foreign income tax recoverable and interest thereon,799,9,799,9,63,36 8. Net deferred tax asset 350,05 350,05 5,706, Guaranty funds receivable or on deposit 0. Electronic data processing equipment and software 36,8 36,8. Furniture and equipment, including health care delivery assets ($ ) 3,66,958 3,66,958. Net adjustment in assets and liabilities due to foreign exchange rates 3. Receivables from parent, subsidiaries and affiliates 4. Health care ($ ) and other amounts receivable 5. Aggregate write-ins for other than invested assets 3,30,496,83,07 30,398,44 8,083, Total assets excluding Separate Accounts, Segregated Accounts and Protected Cell Accounts (Lines to 5),46,00,87 5,36,58,40,659,73,4,78, From Separate Accounts, Segregated Accounts and Protected Cell Accounts 8. Total (Lines 6 and 7),46,00,87 5,36,58,40,659,73,4,78, DETAILS OF WRITE-INS 98. Summary of remaining write-ins for Line from overflow page 99. Totals (Lines 0 thru 03 plus 98)(Line above) 50. Reinsurance premium receivable 8,034,00 8,034,00 5,934, Amica Companies Supplemental Retirement Trust 4,066,8,70,400,364,4,49, Prepaid expenses 9,67 9, Summary of remaining write-ins for Line 5 from overflow page 599. Totals (Lines 50 thru 503 plus 598)(Line 5 above) 3,30,496,83,07 30,398,44 8,083,963

3 LIABILITIES, SURPLUS AND OTHER FUNDS Prior Year Current Year. Aggregate reserve for life contracts $ 70,585,4 (Exh. 5, Line ) less $ included in Line 6.3 (including $ Modco Reserve) 70,585,4 698,0,533. Aggregate reserve for accident and health contracts (including $ Modco Reserve) 3. Liability for deposit-type contracts (Exhibit 7, Line 4, Col. ) (including $ Modco Reserve) 54,758,96 55,70, Contract claims: 4. Life (Exhibit 8, Part, Line 4.4, Col. less sum of Cols. 9, 0 and ) 4,905,389 4,94,7 4. Accident and health (Exhibit 8, Part, Line 4.4, sum of Cols. 9, 0 and ) 5. Policyholders dividends $ and coupons $ due and unpaid (Exhibit 4, Line 0) 6. Provision for policyholders dividends and coupons payable in following calendar year - estimated amounts: 6. Dividends apportioned for payment (including $ Modco) 6. Dividends not yet apportioned (including $ Modco) 6.3 Coupons and similar benefits (including $ Modco) 7. Amount provisionally held for deferred dividend policies not included in Line 6 8. Premiums and annuity considerations for life and accident and health contracts received in advance less $ discount; including $ accident and health premiums (Exhibit, Part, Col., sum of lines 4 and 4) 3,760 6, Contract liabilities not included elsewhere: 9. Surrender values on canceled contracts 9. Provision for experience rating refunds, including the liability of $ accident and health experience rating refunds of which $ is for medical loss ratio rebate per the Public Health Service Act 9.3 Other amounts payable on reinsurance, including $ assumed and $ ceded 9.4 Interest maintenance reserve (IMR, Line 6),409,84,05, Commissions to agents due or accrued-life and annuity contracts $ 778 accident and health $ and deposit-type contract funds $ Commissions and expense allowances payable on reinsurance assumed. General expenses due or accrued (Exhibit, Line, Col. 6) 5,090,649 5,46,86 3. Transfers to Separate Accounts due or accrued (net) (including $ accrued for expense allowances recognized in reserves, net of reinsured allowances) 4. Taxes, licenses and fees due or accrued, excluding federal income taxes (Exhibit 3, Line 9, Col. 5) 87,000 64, Current federal and foreign income taxes, including $ on realized capital gains (losses) 5. Net deferred tax liability 6. Unearned investment income 3,56 4, Amounts withheld or retained by company as agent or trustee 43,64 49, Amounts held for agents' account, including $ agents' credit balances 9. Remittances and items not allocated,784,674 6,959, Net adjustment in assets and liabilities due to foreign exchange rates. Liability for benefits for employees and agents if not included above. Borrowed money $ and interest thereon $ 3. Dividends to stockholders declared and unpaid 4. Miscellaneous liabilities: 4.0 Asset valuation reserve (AVR, Line 6, Col. 7) 4,073,586 0,386, Reinsurance in unauthorized and certified ($ ) companies 4.03 Funds held under reinsurance treaties with unauthorized and certified ($ ) reinsurers 4.04 Payable to parent, subsidiaries and affiliates 8,509 3, Drafts outstanding 4.06 Liability for amounts held under uninsured plans 4.07 Funds held under coinsurance 4.08 Derivatives 4.09 Payable for securities 777,607 40, Payable for securities lending 4. Capital notes $ and interest thereon $ 5. Aggregate write-ins for liabilities 45,6,645 4,85,57 6. Total liabilities excluding Separate Accounts business (Lines to 5) 96,838, ,9,3 7. From Separate Accounts Statement 8. Total liabilities (Lines 6 and 7) 96,838, ,9,3 9. Common capital stock 5,000,000 5,000, Preferred capital stock 3. Aggregate write-ins for other than special surplus funds 3. Surplus notes 33. Gross paid in and contributed surplus (Page 3, Line 33, Col. plus Page 4, Line 5., Col. ) 0,000,000 0,000, Aggregate write-ins for special surplus funds 35. Unassigned funds (surplus) 7,8,309 80,57, Less treasury stock, at cost: 36. shares common (value included in Line 9 $ ) 36. shares preferred (value included in Line 30 $ ) 37. Surplus (Total Lines ) (including $ in Separate Accounts Statement) 73,8,309 8,57, Totals of Lines 9, 30 and 37 (Page 4, Line 55) 78,8,309 87,57, Totals of Lines 8 and 38 (Page, Line 8, Col. 3),40,659,73,4,78,388 DETAILS OF WRITE-INS 50. Reserve for retired lives 36,75,436 35,099, Reserve for unassessed insolvencies,808,000,866, Reserve for non-funded pensions and deferrals,364,4,49, Summary of remaining write-ins for Line 5 from overflow page 5,74,787 3,737, Totals (Lines 50 thru 503 plus 598)(Line 5 above) 45,6,645 4,85, Summary of remaining write-ins for Line 3 from overflow page 399. Totals (Lines 30 thru 303 plus 398)(Line 3 above) Summary of remaining write-ins for Line 34 from overflow page Totals (Lines 340 thru 3403 plus 3498)(Line 34 above) 3

4 SUMMARY OF OPERATIONS Prior Year Current Year. Premiums and annuity considerations for life and accident and health contracts (Exhibit, Part, Line 0.4, Col., less Col. ) 67,407,507 63,60,466. Considerations for supplementary contracts with life contingencies,66,490 97,85 3. Net investment income (Exhibit of Net Investment Income, Line 7) 40,800,094 39,64, Amortization of Interest Maintenance Reserve (IMR, Line 5),488,570,550, Separate Accounts net gain from operations excluding unrealized gains or losses 6. Commissions and expense allowances on reinsurance ceded (Exhibit, Part, Line 6., Col. ) 0,93,809 9,848,98 7. Reserve adjustments on reinsurance ceded 8. Miscellaneous Income: 8. Income from fees associated with investment management, administration and contract guarantees from Separate Accounts 8. Charges and fees for deposit-type contracts 8.3 Aggregate write-ins for miscellaneous income,05 9,40 9. Total (Lines to 8.3) 3,837,495 6,66,98 0. Death benefits 30,678,97 30,69,40. Matured endowments (excluding guaranteed annual pure endowments). Annuity benefits (Exhibit 8, Part, Line 6.4, Cols ) 0,49,964 8,407,97 3. Disability benefits and benefits under accident and health contracts 337,66 335,95 4. Coupons, guaranteed annual pure endowments and similar benefits 5. Surrender benefits and withdrawals for life contracts 9,766,834 9,397,86 6. Group conversions 7. Interest and adjustments on contract or deposit-type contract funds 6,434,67 7,065,75 8. Payments on supplementary contracts with life contingencies,506,5,336, Increase in aggregate reserves for life and accident and health contracts,56,30,6, Totals (Lines 0 to 9) 80,733,44 79,98,688. Commissions on premiums, annuity considerations, and deposit-type contract funds (direct business only) (Exhibit, Part, Line 3, Col. ) 47,64 3,003. Commissions and expense allowances on reinsurance assumed (Exhibit, Part, Line 6., Col. ) 3. General insurance expenses (Exhibit, Line 0, Cols.,, 3 and 4) 38,099,89 37,548, Insurance taxes, licenses and fees, excluding federal income taxes (Exhibit 3, Line 7, Cols ) 3,0,55 3,087, Increase in loading on deferred and uncollected premiums (,456,08) (3,830,67) 6. Net transfers to or (from) Separate Accounts net of reinsurance 7. Aggregate write-ins for deductions,79,89 7,64 8. Totals (Lines 0 to 7) 0,805,76 6,848,65 9. Net gain from operations before dividends to policyholders and federal income taxes (Line 9 minus Line 8) 3,03,39 (68,867) 30. Dividends to policyholders 3. Net gain from operations after dividends to policyholders and before federal income taxes (Line 9 minus Line 30) 3,03,39 (68,867) 3. Federal and foreign income taxes incurred (excluding tax on capital gains) (3,54,009) (3,408,696) 33. Net gain from operations after dividends to policyholders and federal income taxes and before realized capital gains or (losses) (Line 3 minus Line 3) 6,573,38,76, Net realized capital gains (losses) (excluding gains (losses) transferred to the IMR) less capital gains tax of $,00,557 (excluding taxes of $,503,89 transferred to the IMR) 3,73,93,76,4 35. Net income (Line 33 plus Line 34) 0,97,59 5,003,07 CAPITAL AND SURPLUS ACCOUNT 36. Capital and surplus, December 3, prior year (Page 3, Line 38, Col. ) 87,57,076 60,33, Net income (Line 35) 0,97,59 5,003, Change in net unrealized capital gains (losses) less capital gains tax of $ 47, ,69 (3,470,490) 39. Change in net unrealized foreign exchange capital gain (loss) 40. Change in net deferred income tax (3,809,07) (,983,698) 4. Change in nonadmitted assets 8,87,543 9,908,45 4. Change in liability for reinsurance in unauthorized and certified companies 43. Change in reserve on account of change in valuation basis, (increase) or decrease (,033,73) 44. Change in asset valuation reserve (3,687,06) 390, Change in treasury stock (Page 3, Lines 36. and 36., Col. minus Col. ) 46. Surplus (contributed to) withdrawn from Separate Accounts during period 47. Other changes in surplus in Separate Accounts Statement 48. Change in surplus notes 49. Cumulative effect of changes in accounting principles (,437,40) (,437,40) 50. Capital changes: 50. Paid in 50. Transferred from surplus (Stock Dividend) 50.3 Transferred to surplus 5. Surplus adjustment: 5. Paid in 5. Transferred to capital (Stock Dividend) 5.3 Transferred from capital 5.4 Change in surplus as a result of reinsurance 5. Dividends to stockholders 53. Aggregate write-ins for gains and losses in surplus (9,764,843) 9,836, Net change in capital and surplus for the year (Lines 37 through 53) (8,705,767) 7,3, Capital and surplus, December 3, current year (Lines ) (Page 3, Line 38) 78,8,309 87,57,076 DETAILS OF WRITE-INS Reinsurance ceded experience rating refund 3, Referral fees 8,000 9, Summary of remaining write-ins for Line 8.3 from overflow page Totals (Lines thru plus )(Line 8.3 above),05 9, Increase in reserve for retired lives,75,75 70, Fines and penalties of regulatory authorities 3,538, Summary of remaining write-ins for Line 7 from overflow page 799. Totals (Lines 70 thru 703 plus 798)(Line 7 above),79,89 7, Change in Amica Companies Supplemental Retirement Trust 85,093 (88,00) 530. Miscellaneous surplus adjustment 05,58 4, Change in XXX reserves (0,70,665) (,5,94) Summary of remaining write-ins for Line 53 from overflow page 755, 4,5, Totals (Lines 530 thru 5303 plus 5398)(Line 53 above) (9,764,843) 9,836,63 4

5 CASH FLOW Current Year Prior Year Cash from Operations. Premiums collected net of reinsurance 67,5,06 64,385,856. Net investment income 44,099,68 4,756,73 3. Miscellaneous income 0,4,087 9,93, Total (Lines through 3),043,73 7,055, Benefit and loss related payments 6,089,709 54,65,04 6. Net transfers to Separate Accounts, Segregated Accounts and Protected Cell Accounts 7. Commissions, expenses paid and aggregate write-ins for deductions 40,06,098 4,87,38 8. Dividends paid to policyholders 9. Federal and foreign income taxes paid (recovered) net of $ tax on capital gains (losses) (300,000) (,480,56) 0. Total (Lines 5 through 9) 0,850,807 94,43,663. Net cash from operations (Line 4 minus Line 0) 0,9,94,63,993 Cash from Investments. Proceeds from investments sold, matured or repaid:. Bonds 84,957,93 58,0,008. Stocks 6,,63 3,454,008.3 Mortgage loans 49,687 5,550.4 Real estate.5 Other invested assets,876,65 650,376.6 Net gains or (losses) on cash, cash equivalents and short-term investments.7 Miscellaneous proceeds 637,553 40,077.8 Total investment proceeds (Lines. to.7) 4,64,969 7,47,09 3. Cost of investments acquired (long-term only): 3. Bonds 65,88,946 9,54,5 3. Stocks,9,053 0,54, Mortgage loans 3,98,968 5,05, Real estate 3.5 Other invested assets 0,565,597 5,459, Miscellaneous applications 759, Total investments acquired (Lines 3. to 3.6) 3,984,,63, Net increase (decrease) in contract loans and premium notes 98,63 49,6 5. Net cash from investments (Line.8 minus Line 3.7 minus Line 4) 560,5 (50,308,475) Cash from Financing and Miscellaneous Sources 6. Cash provided (applied): 6. Surplus notes, capital notes 6. Capital and paid in surplus, less treasury stock 6.3 Borrowed funds 6.4 Net deposits on deposit-type contracts and other insurance liabilities (7,384,08) (3,084,544) 6.5 Dividends to stockholders 6.6 Other cash provided (applied) (4,83,806),03,67 7. Net cash from financing and miscellaneous sources (Lines 6. to 6.4 minus Line 6.5 plus Line 6.6) (,667,834) (,05,873) RECONCILIATION OF CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS 8. Net change in cash, cash equivalents and short-term investments (Line, plus Lines 5 and 7) 9,085,5 (38,737,355) 9. Cash, cash equivalents and short-term investments: 9. Beginning of year 50,047,07 88,784,47 9. End of year (Line 8 plus Line 9.) 59,3,87 50,047,07 Note: Supplemental disclosures of cash flow information for non-cash transactions: 5

6 6 ANNUAL STATEMENT FOR THE YEAR 06 OF THE AMICA LIFE INSURANCE COMPANY ANALYSIS OF OPERATIONS BY LINES OF BUSINESS Ordinary 6 Group Accident and Health Aggregate of All Total Industrial Life Life Insurance Individual Annuities Supplementary Contracts Credit Life (Group and Individual) Life Insurance (a) Annuities Group Credit (Group and Individual) Other Other Lines of Business. Premiums and annuity considerations for life and accident and health contracts 67,407,507 54,36,70 9,04,033 4,30,304. Considerations for supplementary contracts with life contingencies,66,490,66, Net investment income 40,800,094,94,73 5,339,989,047,86,470,53 4. Amortization of Interest Maintenance Reserve (IMR),488, ,07,733, 7,67 00, Separate Accounts net gain from operations excluding unrealized gains or losses 6. Commissions and expense allowances on reinsurance ceded 0,93,809 0,93, Reserve adjustments on reinsurance ceded 8. Miscellaneous Income: 8. Fees associated with income from investment management, administration and contract guarantees from Separate Accounts 8. Charges and fees for deposit-type contracts 8.3 Aggregate write-ins for miscellaneous income,05 8,000 3,05 9. Totals (Lines to 8.3) 3,837,495 77,96,87 36,4,33 3,746,03 6,04,4 0. Death benefits 30,678,97 7,860,57,88,400. Matured endowments (excluding guaranteed annual pure endowments). Annuity benefits 0,49,964 0,49, Disability benefits and benefits under accident and health contracts 337,66 337,66 4. Coupons, guaranteed annual pure endowments and similar benefits 5. Surrender benefits and withdrawals for life contracts 9,766,834 4,037,534 5,79, Group conversions 7. Interest and adjustments on contract or deposit-type contract funds 6,434,67 58,4 6,55, , Payments on supplementary contracts with life contingencies,506,5,506,5 9. Increase in aggregate reserves for life and accident and health contracts,56,30 0,68,060 (5,703),400, Totals (Lines 0 to 9) 80,733,44 4,66,934 3,35,394,908,085,838,00. Commissions on premiums, annuity considerations and deposit-type contract funds (direct business only) 47,64 47,64. Commissions and expense allowances on reinsurance assumed 3. General insurance expenses 38,099,89 33,5,350 4,380,075 6,855 06,6 4. Insurance taxes, licenses and fees, excluding federal income taxes 3,0,55,899,64 89,40 0,547 0,96 5. Increase in loading on deferred and uncollected premiums (,456,08) (,456,08) 6. Net transfers to or (from) Separate Accounts net of reinsurance 7. Aggregate write-ins for deductions,79,89 3,04 09,75, Totals (Lines 0 to 7) 0,805,76 76,407,86 36,894,88 3,80,499 4,3, Net gain from operations before dividends to policyholders and federal income taxes (Line 9 minus Line 8) 3,03,39,555,63 (780,585) 565,54,69, Dividends to policyholders 3. Net gain from operations after dividends to policyholders and before federal income taxes (Line 9 minus Line 30) 3,03,39,555,63 (780,585) 565,54,69, Federal income taxes incurred (excluding tax on capital gains) (3,54,009) (4,,0) (359,98) 60,80 780,8 33. Net gain from operations after dividends to policyholders and federal income taxes and before realized capital gains or (losses) (Line 3 minus Line 3) 6,573,38 5,777,64 (40,604) 304,7 9,568 DETAILS OF WRITE-INS Reinsurance ceded experience rating refund 3,05 3, Referral fees 8,000 8, Summary of remaining write-ins for Line 8.3 from overflow page Totals (Lines thru plus ) (Line 8.3 above),05 8,000 3, Increase in retired lives reserve,75,75,75, Fines and penalties of regulatory authorities 3,538 3, Summary of remaining write-ins for Line 7 from overflow page 799. Totals (Lines 70 thru 703 plus 798) (Line 7 above),79,89 3,04 09,75,864 (a) Includes the following amounts for FEGLI/SGLI: Line, Line 0, Line 6, Line 3, Line 4

7 ANALYSIS OF INCREASE IN RESERVES DURING THE YEAR Ordinary 6 Group Total Industrial Life Life Insurance Individual Annuities Supplementary Contracts Credit Life (Group and Individual) Life Insurance 8 Annuities Involving Life or Disability Contingencies (Reserves) (Net of Reinsurance Ceded). Reserve December 3, prior year 698,0,533 63,645,6 43,00,374,54,374 3,74. Tabular net premiums or considerations,797,307,488,580 8,68,37,66, Present value of disability claims incurred 0,0 0,0 XXX 4. Tabular interest 7,883,506,835,933 5,433,564 63, Tabular less actual reserve released,965,470,490,4 475,9 6. Increase in reserve on account of change in valuation basis 7 7. Other increases (net) 47,84 756,359 (608,545) 8. Totals (Lines to 7) 85,05,64 387,07,36 449,38,775 4,648,45 3,36 9. Tabular cost 90,,53 90,,454 XXX Reserves released by death 3,3,644 3,3,644 XXX XXX XXX. Reserves released by other terminations (net) 9,369,5 9,06,643 9,66 60,893. Annuity, supplementary contract and disability payments involving life contingencies 7,85,073 04,059 6,4,493,506,5 3. Net transfers to or (from) Separate Accounts 4. Total Deductions (Lines 9 to 3) 30,50,400 0,446,800 6,306,09,767, Reserve December 3, current year 70,585,4 84,64,336 43,076,666,88,00 3,39

8 EXHIBIT OF NET INVESTMENT INCOME Collected During Year Earned During Year. U.S. Government bonds (a) 3,797,688 3,536,036. Bonds exempt from U.S. tax (a). Other bonds (unaffiliated) (a),03,903,83,34.3 Bonds of affiliates (a). Preferred stocks (unaffiliated) (b). Preferred stocks of affiliates (b). Common stocks (unaffiliated),85,45,90,393. Common stocks of affiliates 3. Mortgage loans (c) 454, , Real estate (d) 5 Contract loans 66,83 60,333 6 Cash, cash equivalents and short-term investments (e) 850,650 83,890 7 Derivative instruments (f) 8. Other invested assets,463,640,463, Aggregate write-ins for investment income 8,433 9, Total gross investment income 4,763,86 4,358,86. Investment expenses (g) 558,768. Investment taxes, licenses and fees, excluding federal income taxes (g) 3. Interest expense (h) 4. Depreciation on real estate and other invested assets (i) 5. Aggregate write-ins for deductions from investment income 6. Total deductions (Lines through 5) 558, Net investment income (Line 0 minus Line 6) 40,800,094 DETAILS OF WRITE-INS 090. Miscellaneous Interest 64,603 64, Income from Supplemental Retirement Trust 6,830 8, Summary of remaining write-ins for Line 9 from overflow page Totals (Lines 090 thru 0903 plus 0998) (Line 9, above) 8,433 9, Summary of remaining write-ins for Line 5 from overflow page 599. Totals (Lines 50 thru 503 plus 598) (Line 5, above) (a) Includes $ 653,84 accrual of discount less $ 3,548,349 amortization of premium and less $ 445,093 paid for accrued interest on purchases. (b) Includes $ accrual of discount less $ amortization of premium and less $ paid for accrued dividends on purchases. (c) Includes $ accrual of discount less $ amortization of premium and less $ paid for accrued interest on purchases. (d) Includes $ for company s occupancy of its own buildings; and excludes $ interest on encumbrances. (e) Includes $ 34,94 accrual of discount less $ amortization of premium and less $ paid for accrued interest on purchases. (f) Includes $ accrual of discount less $ amortization of premium. (g) Includes $ investment expenses and $ investment taxes, licenses and fees, excluding federal income taxes, attributable to segregated and Separate Accounts. (h) Includes $ interest on surplus notes and $ interest on capital notes. (i) Includes $ depreciation on real estate and $ depreciation on other invested assets. EXHIBIT OF CAPITAL GAINS (LOSSES) Total Realized Capital Gain (Loss) (Columns + ) Change in Unrealized Capital Gain (Loss) Realized Gain (Loss) On Sales or Maturity Other Realized Adjustments. U.S. Government bonds,706,563,706,563. Bonds exempt from U.S. tax. Other bonds (unaffiliated),590,7,590,7.3 Bonds of affiliates. Preferred stocks (unaffiliated). Preferred stocks of affiliates. Common stocks (unaffiliated) 5,938,36 (799,645) 5,38,68 (744,90). Common stocks of affiliates 3. Mortgage loans 4. Real estate 5. Contract loans 6. Cash, cash equivalents and short-term investments 7. Derivative instruments 8. Other invested assets 6,560 (330,753) (4,93),095,95 9. Aggregate write-ins for capital gains (losses) 0. Total capital gains (losses) 0,35,70 (,30,398) 9,,3,350,94 DETAILS OF WRITE-INS Summary of remaining write-ins for Line 9 from overflow page Totals (Lines 090 thru 0903 plus 0998) (Line 9, above) Change in Unrealized Foreign Exchange Capital Gain (Loss) 8

9 9 ANNUAL STATEMENT FOR THE YEAR 06 OF THE AMICA LIFE INSURANCE COMPANY EXHIBIT - PART - PREMIUMS AND ANNUITY CONSIDERATIONS FOR LIFE AND ACCIDENT AND HEALTH CONTRACTS Ordinary 5 Group Accident and Health Aggregate of All Total Industrial Life Life Insurance Individual Annuities Credit Life (Group and Individual) Life Insurance Annuities Group Credit (Group and Individual) Other Other Lines of Business FIRST YEAR (other than single). Uncollected (85,773) (85,773). Deferred and accrued,58,85,58,85 3. Deferred, accrued and uncollected: 3. Direct,585,58,585,58 3. Reinsurance assumed 3.3 Reinsurance ceded 34,53 34, Net (Line + Line ),43,05,43,05 4. Advance 5. Line Line 4,43,05,43,05 6. Collected during year: 6. Direct 9,875,758 7,844,,03, Reinsurance assumed 6.3 Reinsurance ceded 3,043,77 3,043, Net 6,83,03 4,800,395,03, Line 5 + Line 6.4 9,075,08 7,043,446,03, Prior year (uncollected + deferred and accrued - advance),640,57,640,57 9. First year premiums and considerations: 9. Direct 9,543,887 7,5,5,03, Reinsurance assumed 9.3 Reinsurance ceded 3,09,06 3,09, Net (Line 7 - Line 8) 6,434,85 4,403,89,03,636 SINGLE 0. Single premiums and considerations: 0. Direct,099,9,099,9 0. Reinsurance assumed 0.3 Reinsurance ceded 0.4 Net,099,9,099,9 RENEWAL. Uncollected (,958,0) (,958,0). Deferred and accrued 30,59,53 30,59,53 3. Deferred, accrued and uncollected: 3. Direct 30,870,07 30,870,07 3. Reinsurance assumed 3.3 Reinsurance ceded 3,36,677 3,36, Net (Line + Line ) 7,633,430 7,633, Advance 3,760 3, Line Line 4 7,49,670 7,49, Collected during year: 6. Direct 90,08,76 80,493,3 4,909,486 4,66,07 6. Reinsurance assumed 6.3 Reinsurance ceded 34,055,4 33,669,48 385, Net 55,963,585 46,83,795 4,909,486 4,30, Line 5 + Line ,383,55 74,43,465 4,909,486 4,30, Prior year (uncollected + deferred and accrued - advance) 4,50,483 4,50, Renewal premiums and considerations: 9. Direct 9,973,946 8,448,443 4,909,486 4,66,07 9. Reinsurance assumed 9.3 Reinsurance ceded 33,0,75 3,75,46 385, Net (Line 7 - Line 8) 58,87,77 49,73,98 4,909,486 4,30,304 TOTAL 0. Total premiums and annuity considerations: 0. Direct 03,67,744 89,960,694 9,04,033 4,66,07 0. Reinsurance assumed 0.3 Reinsurance ceded 36,0,37 35,84,54 385, Net (Lines ) 67,407,507 54,36,70 9,04,033 4,30,304

10 0 DIVIDENDS AND COUPONS APPLIED (included in Part ). To pay renewal premiums. All other REINSURANCE COMMISSIONS AND EXPENSE ALLOWANCES INCURRED 3. First year (other than single): ANNUAL STATEMENT FOR THE YEAR 06 OF THE AMICA LIFE INSURANCE COMPANY EXHIBIT - PART - DIVIDENDS AND COUPONS APPLIED, REINSURANCE COMMISSIONS AND EXPENSE ALLOWANCES AND COMMISSIONS INCURRED (Direct Business Only) Ordinary 5 Group Accident and Health Total Industrial Life Life Insurance 3. Reinsurance ceded 3,493,95 3,493,95 3. Reinsurance assumed 3.3 Net ceded less assumed 3,493,95 3,493,95 4. Single: 4. Reinsurance ceded 4. Reinsurance assumed 4.3 Net ceded less assumed 5. Renewal: 5. Reinsurance ceded 6,799,884 6,799, Reinsurance assumed 5.3 Net ceded less assumed 6,799,884 6,799, Totals: 6. Reinsurance ceded (Page 6, Line 6) 0,93,809 0,93, Reinsurance assumed (Page 6, Line ) 6.3 Net ceded less assumed 0,93,809 0,93,809 COMMISSIONS INCURRED (direct business only) 7. First year (other than single) 47,64 47,64 8. Single 9. Renewal 30. Deposit-type contract funds 3. Totals (to agree with Page 6, Line ) 47,64 47,64 Individual Annuities Credit Life (Group and Individual) Life Insurance Annuities Group Credit (Group and Individual) Other Aggregate of All Other Lines of Business

11 EXHIBIT - GENERAL EXPENSES Insurance 5 6 Accident and Health 4 Life Cost Containment 3 All Other All Other Lines of Business Investment Total. Rent 500, ,058. Salaries and wages 4,009,68 403,884 4,43,05 3. Contributions for benefit plans for employees,558,309,558, Contributions for benefit plans for agents 3. Payments to employees under non-funded benefit plans 3. Payments to agents under non-funded benefit plans 3.3 Other employee welfare,47,0 8,944,553, Other agent welfare 4. Legal fees and expenses 7,07 7,07 4. Medical examination fees,305,33,305, Inspection report fees 9,653 9, Fees of public accountants and consulting actuaries 53,03 53, Expense of investigation and settlement of policy claims 5,779 5, Traveling expenses 9,446 9, Advertising 0,56,507 0,56, Postage, express, telegraph and telephone 377, , Printing and stationery 47,64 47, Cost or depreciation of furniture and equipment 668,39 668, Rental of equipment 5.7 Cost or depreciation of EDP equipment and software 606,05 606,05 6. Books and periodicals 5,77 5,77 6. Bureau and association fees 49,3 49,3 6.3 Insurance, except on real estate 6.4 Miscellaneous losses 6.5 Collection and bank service charges 400, , Sundry general expenses 6.7 Group service and administration fees 6.8 Reimbursements by uninsured plans 7. Agency expense allowance 7. Agents balances charged off (less $ recovered) 7.3 Agency conferences other than local meetings 9. Real estate expenses 9. Investment expenses not included elsewhere 7,7 7,7 9.3 Aggregate write-ins for expenses 4,67,979 4,67, General expenses incurred 38,099,89 558,768 (a) 38,658,660. General expenses unpaid December 3, prior year 5,46,86 5,46,86. General expenses unpaid December 3, current year 5,090,649 5,090, Amounts receivable relating to uninsured plans, prior year 4. Amounts receivable relating to uninsured plans, current year 5. General expenses paid during year (Lines ) 38,55,59 558,768 38,74,97 DETAILS OF WRITE-INS Data processing and consulting fees 4,39,778 4,39, Non-qualified pensions 36,0 36, Summary of remaining write-ins for Line 9.3 from overflow page Totals (Lines thru plus ) (Line 9.3 above) 4,67,979 4,67,979 (a) Includes management fees of $,757,7 to affiliates and $ to non-affiliates. EXHIBIT 3 - TAXES, LICENSES AND FEES (EXCLUDING FEDERAL INCOME TAXES) Insurance 4 5 Life Accident and Health 3 All Other Lines of Business Investment Total. Real estate taxes. State insurance department licenses and fees 336,08 336,08 3. State taxes on premiums,777,990,777, Other state taxes, including $ 8,765 for employee benefits 96,0 96,0 5. U.S. Social Security taxes 959,73 959,73 6. All other taxes 3,60 3,60 7. Taxes, licenses and fees incurred 3,0,55 3,0,55 8. Taxes, licenses and fees unpaid December 3, prior year 64,000 64, Taxes, licenses and fees unpaid December 3, current year 87,000 87, Taxes, licenses and fees paid during year (Lines ) 3,078,55 3,078,55 EXHIBIT 4 - DIVIDENDS OR REFUNDS. Applied to pay renewal premiums. Applied to shorten the endowment or premium-paying period 3. Applied to provide paid-up additions 4. Applied to provide paid-up annuities 5. Total Lines through 4 6. Paid in cash 7. Left on deposit 8. Aggregate write-ins for dividend or refund options 9. Total Lines 5 through 8 0. Amount due and unpaid NONE. Provision for dividends or refunds payable in the following calendar year. Terminal dividends 3. Provision for deferred dividend contracts 4. Amount provisionally held for deferred dividend contracts not included in Line 3 5. Total Lines 0 through 4 6. Total from prior year 7. Total dividends or refunds (Lines ) DETAILS OF WRITE-INS Summary of remaining write-ins for Line 8 from overflow page Totals (Lines 080 thru 0803 plus 0898) (Line 8 above) Life Accident and Health

12 EXHIBIT 5 - AGGREGATE RESERVE FOR LIFE CONTRACTS Valuation Standard Total 3 Industrial 4 Ordinary 5 Credit (Group and Individual) 6 Group CSO.50% CRVM ANB IDB ,88 3, CSO.50% NLP ANB IDB 96-96,767, CSO 3.50% CRVM ALB IDB ,86,38 3,86, CSO 3.50% NLP ALB IDB ,735 49, CSO 4.00% CRVM ALB IDB ,530,57 5,530, CSO 4.00% NLP ALB IDB ,57 55, CSO 4.50% CRVM ALB IDB ,44,750 5,44, CSO 4.50% NLP ALB IDB , 590, CSO 3.00% CRVM ANB IDB ,598,63,598, CSO 3.00% NLP ANB IDB ,47 44,009, CSO 3.50% CRVM ANB IDB ,56 456, CSO 3.50% NLP ANB IDB ,664 38, CSO 4.00% CRVM ANB IDB , , CSO 4.00% NLP ANB IDB ,79 9, CSO 4.50% CRVM ANB IDB ,087 47, CSO 4.50% NLP ANB IDB ,36 86, CET 3.50% NLP ALB IDB ,469 3, CET 4.00% NLP ALB IDB ,37, CET 3.00% NLP ANB IDB ,053 85, CET 3.50% NLP ANB IDB ,473, CET 4.50% NLP ANB IDB ,56 40, CSO 4.00% CRVM ALB IDB ,49,90 53,49, CSO 4.00% NLP ALB IDB ,39 08, CSO 4.50% CRVM ALB IDB ,47,088 48,47, CSO 4.50% NLP ALB IDB ,355,496 4,355, CSO 5.00% CRVM ALB IDB ,534,43 4,534, CSO 5.00% NLP ALB IDB ,07 8, CSO 5.50% CRVM ALB IDB ,86,5 3,86, CSO 5.50% NLP ALB IDB ,898,60,898, CSO 6.00% CRVM ALB IDB ,088 30, CSO 6.00% NLP ALB IDB ,767 55, CET 6.00% NLP ALB IDB ,35, CSO 3.50% CRVM ALB IDB ,53,978 6,53, CSO 3.50% NLP ALB IDB ,607 4, CSO 4.00% CRVM ALB IDB ,445,336 37,445, CSO 4.00% NLP ALB IDB ,696 69, UER ALB IDB ,746, Totals (Gross) 454,783, 454,78,984, Reinsurance ceded 90,588,9 90,588, Life Insurance: Totals (Net) 64,94,83 64,93,693, a % CARVM 03-05,59,59 XXX,59,59 XXX a % CARVM ,0,99 XXX 0,0,99 XXX a % CARVM 04-04,399,40 XXX,399,40 XXX a % CARVM ,94,056 XXX 5,94,056 XXX a % CARVM ,004,634 XXX 9,004,634 XXX a % CARVM ,60,00 XXX 34,60,00 XXX a % CARVM ,495,48 XXX 48,495,48 XXX a 5.5% CARVM ,753,398 XXX,753,398 XXX a % CARVM ,0,006 XXX 58,0,006 XXX a 5.50% CARVM ,9,58 XXX 4,9,58 XXX a % CARVM ,467,068 XXX 9,467,068 XXX a 5.75% CARVM ,05,609 XXX 8,05,609 XXX a % CARVM ,304 XXX 445,304 XXX a 6.00% CARVM ,969,697 XXX 5,969,697 XXX a 6.5% CARVM ,9,87 XXX 3,9,87 XXX a 6.50% CARVM ,596,56 XXX 6,596,56 XXX a 6.75% CARVM ,467,00 XXX 5,467,00 XXX a 8.00% CARVM ,88,333 XXX 5,88,333 XXX a 8.5% CARVM ,775,3 XXX 7,775,3 XXX a 9.5% CARVM ,55 XXX 874,55 XXX a % Imm ,583 XXX 5,583 XXX a % Imm ,57 XXX 953,57 XXX a % Imm ,30 XXX 848,30 XXX a % Imm ,44 XXX 85,44 XXX a % Imm ,478 XXX 693,478 XXX a 5.00% Imm ,743 XXX 76,743 XXX a % Imm 00-0,376,73 XXX,376,73 XXX a 5.5% Imm ,9 XXX 67,9 XXX a % Imm ,697,936 XXX 8,697,936 XXX a 5.30% Imm ,76,067 XXX,76,067 XXX a % Imm ,389,45 XXX 5,389,45 XXX a % Imm ,385,40 XXX 7,385,40 XXX a % Imm ,7 XXX 945,7 XXX a % Imm ,9,533 XXX 5,9,533 XXX a % Imm ,67 XXX 59,67 XXX a % Imm ,7,9 XXX 5,7,9 XXX a % Imm ,350,095 XXX,350,095 XXX a % Imm ,08,36 XXX,08,36 XXX Totals (Gross) 43,076,666 XXX 43,076,666 XXX Reinsurance ceded XXX XXX Annuities: Totals (Net) 43,076,666 XXX 43,076,666 XXX IAM 4.00% Imm ,85,54 3,85, a % Imm , , a % Imm 0-0,798,463,798, a % Imm ,46 4, a % Imm 005-0,054,35,054, a % Imm ,307,365,307, a 5.30% Imm , , a % Imm ,30 365, a % Imm , , a % Imm ,70 40, a % Imm ,07 3,07

13 EXHIBIT 5 - AGGREGATE RESERVE FOR LIFE CONTRACTS Valuation Standard Total 3 Industrial 4 Ordinary 5 Credit (Group and Individual) 6 Group a % Imm ,593 35, a % Imm ,394 34, a % Imm ,63 74, Totals (Gross),88,00,88, Reinsurance ceded SCWLC: Totals (Net),88,00,88, ADB, with 58 CSO 3 /% 5,453 5, ADB, with 80 CSO 3 /% 0,50 6,99 4, Totals (Gross) 35,954 3,75 4, Reinsurance ceded 33,74 3,640, Accidental Death Benefits: Totals (Net),3, INTERCO DISA, Period, with 58 CSO 3 /% 6,43 6, INTERCO DISA, Period, with 80 CSO 4 /% 7,69 7, Totals (Gross) 89,05 89, Reinsurance ceded Disability-Active Lives: Totals (Net) 89,05 89, INTERCO DISA, Period, with 58 CSO 3 /% 383,5 383, INTERCO DISA, Period, with 80 CSO 3 /% 34,97 34, INTERCO DISA, Period, with 80 CSO 4 /%,300,493,300, Totals (Gross),997,94,997, Reinsurance ceded Disability-Disabled Lives: Totals (Net),997,94,997, Excess of valuation net premiums over gross premiums on respective policies,,995,374,995, computed according to the standard valuation required by this state 3,64,59 3,64, Non-deduction of deferred fractional premiums or return of premiums at the death of the insured. 54,86 54, Totals (Gross) 6,70,494 6,70, Reinsurance ceded 9,458,956 9,458, Miscellaneous Reserves: Totals (Net) 7,43,538 7,43, Totals (Net) - Page 3, Line 70,585,4 70,58,003 3,39.

14 EXHIBIT 5 - INTERROGATORIES. Has the reporting entity ever issued both participating and non-participating contracts? Yes [ ] No [ X ]. If not, state which kind is issued. Non-participating. Does the reporting entity at present issue both participating and non-participating contracts? Yes [ ] No [ X ]. If not, state which kind is issued. Non-participating 3. Does the reporting entity at present issue or have in force contracts that contain non-guaranteed elements? Yes [ X ] No [ ] If so, attach a statement that contains the determination procedures, answers to the interrogatories and an actuarial opinion as described in the instructions. 4. Has the reporting entity any assessment or stipulated premium contracts in force? Yes [ ] No [ X ] If so, state: 4. Amount of insurance? $ 4. Amount of reserve? $ 4.3 Basis of reserve: 4.4 Basis of regular assessments: 4.5 Basis of special assessments: 4.6 Assessments collected during the year $ 5. If the contract loan interest rate guaranteed in any one or more of its currently issued contracts is less than 5%, not in advance, state the contract loan rate guarantees on any such contracts. 6. Does the reporting entity hold reserves for any annuity contracts that are less than the reserves that would be held on a standard basis? Yes [ ] No [ X ] 6. If so, state the amount of reserve on such contracts on the basis actually held: $ 6. That would have been held (on an exact or approximate basis) using the actual ages of the annuitants; the interest rate(s) used in 6.; and the same mortality basis used by the reporting entity for the valuation of comparable annuity benefits issued to standard lives. If the reporting entity has no comparable annuity benefits for standard lives to be valued, the mortality basis shall be the table most recently approved by the state of domicile for valuing individual annuity benefits: $ Attach statement of methods employed in their valuation. 7. Does the reporting entity have any Synthetic GIC contracts or agreements in effect as of December 3 of the current year? Yes [ ] No [ X ] 7. If yes, state the total dollar amount of assets covered by these contracts or agreements $ 7. Specify the basis (fair value, amortized cost, etc.) for determining the amount: 7.3 State the amount of reserves established for this business: $ 7.4 Identify where the reserves are reported in the blank: 8. Does the reporting entity have any Contingent Deferred Annuity contracts or agreements in effect as of December 3 of the current year? Yes [ ] No [ X ] 8. If yes, state the total dollar amount of account value covered by these contracts or agreements: $ 8. State the amount of reserves established for this business: $ 8.3 Identify where the reserves are reported in the blank: 9. Does the reporting entity have any Guaranteed Lifetime Income Benefit contracts, agreements or riders in effect as of December 3 of the current year? Yes [ ] No [ X ] 9. If yes, state the total dollar amount of any account value associated with these contracts, agreements or riders: $ 9. State the amount of reserves established for this business: $ 9.3 Identify where the reserves are reported in the blank: EXHIBIT 5A - CHANGES IN BASES OF VALUATION DURING THE YEAR Valuation Basis 4 3 Increase in Actuarial Reserve Due to Description of Valuation Class NONE Changed From Changed To Change Total (Column 4, only) 3

15 Ernst & Young LLP One Commerce Square Suite Market Street Philadelphia, PA 903 Tel: Fax: ey.com February 8, 07 Board of Directors Amica Life Insurance Company Corporate Office Ten Amica Center Boulevard Lincoln, RI I, David Minches, am a member of the American Academy of Actuaries, and an employee of the firm of Ernst & Young LLP. I meet the Academy qualification standards for issuing this opinion. I have reviewed the actuarial assumptions and actuarial methods used in determining nonguaranteed elements for the individual life insurance and annuity policies of Amica Life Insurance Company ("the Company") used for delivery in the United States. The non-guaranteed elements included are those: i. paid, credited, charged or determined in 06; and ii. authorized by the Company to be illustrated on new and existing business during 06. My examination included such review of the actuarial assumptions and actuarial methods of the underlying basic records and such tests of the actuarial calculations, as I considered necessary. In my opinion, the nonguaranteed elements described above have been determined in accordance with Actuarial Standards of Practice issued by the Actuarial Standards Board applicable to the determination of nonguaranteed elements, except as described above. My review relates only to the non-guaranteed elements identified herein, and I do not express an opinion on the Company's financial statements taken as a whole. This opinion has been prepared solely for the Board and the management of the Company and for filing with insurance regulatory agencies of states in which the Company is licensed, and is not intended for any other purpose. David Minches, ASA, MAAA Ernst & Young One Commerce Square 005 Market Street Suite 700 Philadelphia, PA (5) A member firm of Ernst & Young Global Limited

16 Amica Life Insurance Company Statement for Non-Guaranteed Elements Exhibit 5, Question 3 December 3, 06 Determination Procedures Statement of policy regarding the determination and redetermination of non-guaranteed charges and benefits for life insurance and annuity contracts. This is a statement regarding changes to contractual non-guaranteed elements with respect to solvency concerns, marketing goals, and profit objectives. Nothing in this statement is intended to contravene contractual obligations or regulatory and legal requirements. With regard to universal life, traditional permanent and term life insurance premiums, the Company will review the premium rates at least once every five years to determine whether or not a change should be made. For traditional plans, the Company may change such rates as often as each policy anniversary. For universal life, changes to COI will be made on month anniversary. Any change the Company makes will be based on the Company s expectations as to future mortality, persistency, expenses and investment earnings (except for universal life) experience. For universal life and annuities, the interest credited rate is reviewed at least once a month, but spreads remain constant. An actuarial review is performed whenever changes are made to anticipated spreads. Any change will be uniformly made for all policies of this type for all insureds of the same age, sex, face amount and rate class; and will be in accordance with procedures and standards on file with the department of insurance. The Company will notify policyholders, in writing, at least twenty days before the policy anniversary on which the premium rates will be changed. If the premium rates change, the new rates may be higher or lower than those previously in effect. However, the rates will never exceed the guaranteed premium or cost of insurance rates in the policy. No changes will be made due to changes in the health or occupation of any one insured. In determining possible changes, historical premiums or charges, credited interest (if any), and actuarial assumptions will be used to project test cells to the review date. Expected experience will be relied on to revise actuarial assumptions for subsequent years. Premiums or charges will be solved for to maintain original profit objectives. The decision to change premiums and charges, without recouping any past losses, involves profit objectives, solvency, and marketing objectives. The Company profit objective is to achieve a present value of book profits that is at least five to seven percent of the present value of premium measured over a thirty year period. The breakeven objective is seven to ten years. With regard to solvency, each product should contribute to capital and surplus at a rate commensurate with risk and dependent on emergence of profit. Actuarial measures of asset risk and insurance risk will be employed to determine minimum levels of capital and surplus. A member firm of Ernst & Young Global Limited