Disclosures and Policies

Disclosures Regarding MEGA’s/the NASE’s Business Relationship


Introduction
Set forth below is information concerning the National Association for the Self-Employed (the “NASE”) and The MEGA Life and Health Insurance Company (“MEGA”) and a description of the relationships between the two organizations.

More About the NASE
The NASE is a membership organization that provides certain benefits to its Members. The NASE is organized under the laws of the State of Texas and its principal place of business is Capital Center, 1235 Main Street, Suite 100, Grapevine, TX 76051. The NASE also has an office in Washington, D.C., from which it carries out many of its legislative and advocacy efforts. The NASE is governed by a board of directors, the members of which are elected in staggered terms by Members of the NASE, with election occurring on one-third of the directors each year. Members of the NASE are entitled to vote on the selection of members of the board of directors at the annual meeting of the NASE. The NASE maintains a website at www.nase.org. NASE Members are required to pay monetary dues. The NASE has no direct or indirect ownership interest in UICI or Specialized Association Services, Inc. (“SAS”).

More About MEGA
MEGA is an Oklahoma domiciled life and health insurance company with an administrative office located in North Richland Hills, TX. MEGA is licensed to issue health, life and annuity insurance policies to consumers in all states except New York. MEGA is a wholly owned subsidiary of UICI, a Delaware corporation.
UICI is a public company that files annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission. You may inspect and copy such reports, proxy statements and other information at the public reference facilities maintained by the Securities and Exchange Commission at:

Room 1204		Citicorp Center
Judiciary Plaza	OR	500 West Madison Street
450 Fifth Street, NW		Chicago, IL 60661
Washington, DC 20549

You may call the Securities and Exchange Commission at 1-800-SEC-0330 for further information about the public reference facilities. This material may also be obtained from the Securities and Exchange Commission's worldwide web site at http://www.sec.gov. Shares of UICI common stock are traded on the New York Stock Exchange under the symbol "UCI." UICI maintains a website at www.uici.net.
Relationships Between MEGA and Affiliates and the NASE

The NASE and MEGA entered into an agreement in 1996, pursuant to which the NASE has made available to its Members certain MEGA health insurance products. This agreement with MEGA requiring the NASE to continue as the master policyholder and to make MEGA insurance products available to Members of the NASE may only be terminated by MEGA or by the NASE upon not less than one (1) year’s advance notice to the other party.

The salesperson that a prospective Member or prospective insured speaks with about NASE membership and about MEGA insurance products serves both as a licensed insurance agent of MEGA and as a field service representative for new Members for the NASE, for which he or she will receive compensation. The health insurance premiums derived from the sale of health insurance go to MEGA and the membership dues derived from the sale of memberships go to the NASE. The salesperson acts on behalf of MEGA (and not the NASE) when discussing, explaining, and describing MEGA health insurance products and premiums. The salesperson acts on behalf of the NASE (and not MEGA) when discussing, explaining, and describing other NASE benefits. The NASE pays an affiliate of UICI for enrolling new Members and pays MEGA and/or affiliates of MEGA for ongoing membership marketing and administrative services for certain NASE Member benefits obtained from MEGA or its affiliates.

Ronald L. Jensen serves as Chairman of UICI, and he, together with members of his immediate family and trusts in which he may have an interest, holds in the aggregate approximately 16.4% of the issued and outstanding capital stock of UICI. SAS (which is controlled by Mr. Jensen's adult children) has entered into an agreement with the NASE to provide certain administrative services, including billing, administrative, fulfillment, and benefit procurement services. The NASE pays SAS for these services. SAS has no ownership interest in the NASE. A subsidiary of UICI also sells new membership sales leads to the field service representatives and video and print services to the NASE and SAS. UICI nor MEGA has any ownership interest in SAS or the NASE.