A.M. Best Co. Affirms Excellent Rating
Ratings Agency Praises Insurance Companies for conservatively managed portfolio

Montpelier, Vermont (November 12, 2008) - A.M. Best Co. has affirmed the financial strength rating (FSR) of A (Excellent) for National Life Insurance Co. and Life Insurance Company of the Southwest, the two insurance companies of National Life Group. The rating agency maintained an outlook of stable on the financial strength rating.

In a press release dated Nov. 12, A.M. Best said the ratings reflect National Life Group's "positive growth trends in its core life and annuity lines, solid operating performance and diverse distribution channels. The company also benefits from its competitive positions in the indexed universal life (UL) insurance and 403 (b) indexed annuity markets, as well as a conservative risk profile and good expense management," A.M. Best said.

"National Life's investment portfolio is conservatively managed, with no exposure to non-agency residential mortgaged-backed securities," said A.M. Best. "Additionally, the company maintains moderate financial leverage and has minimal exposure to structured securities backed with subprime collateral, which represent less than 1% of its total investment portfolio. National Life also continues to exercise discipline in product design, choosing not to compete aggressively in the universal life no-lapse guarantee market or to offer living benefit guarantees on its variable annuities."

About National Life Group

National Life Group (NLGroup) is a diversified family of financial service companies that has successfully forged a strong identity as a product innovator. Companies in the group offer a comprehensive portfolio of life insurance, annuity and investment* products to help individuals, families and businesses pursue their financial goals.

NLGroup, a Fortune 1000 company, serves more than 700,000 customers. With 2007 combined revenue of $1.4 billion and net income of $109 million, NLGroup employs roughly 900 employees, with most located at its home office in Montpelier, Vt. Group companies also maintain offices in Dallas, New York, San Francisco, Boston and Philadelphia.

The Group is made up of its flagship company, National Life Insurance Company, chartered in Montpelier, Vermont in 1848; Life Insurance Company of the Southwest, Dallas, Texas, and Sentinel Investments, Equity Services, Inc. and National Retirement Plan Advisors Inc., all based in Montpelier and are all affiliates. National Life Insurance Co. is licensed to do business in all 50 states and the District of Columbia. Life Insurance Company of the Southwest is licensed to do business in 48 states and the District of Columbia. It is not licensed in New York. Each company is solely responsible for its own financial condition and contractual obligations. Sentinel Investments is a unifying brand name for Sentinel Financial Services Co., Sentinel Asset Management, Inc., and Sentinel Administrative Services, Inc.

• Securities are offered through Registered Representatives of Equity Services, Inc., Member FINRA/SIPC, One National Life Drive, Montpelier, Vermont 50604 (802) 229-3900. National Life Group is a trade name of National Life Insurance Co., Montpelier, Vt., and its affiliates.

The rating of "A" is by A.M. Best Company is the third highest of the company's 16 financial strength ratings. Rates are subject to change without notice.

About A.M. Best Company

Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.

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