Sept. 6, 2002                                                         Contact:Lucas Hamilton

State Auditor's rehabilitation of MBLC a success Only five percent of rehabilitations succeed


      Montana State Auditor John Morrison today announced that policyholders of financially troubled Montana Benefits and Life Co. have a safe, new home.
      As part of a rehabilitation plan approved by District Court Judge Jeffrey Sherlock, New West Health Services Co., through a newly incorporated subsidiary, will assume all the responsibilities for the life and health policies of MBLC as of Oct.1, 2002. New West, based in Helena, is the second-largest health insurance company in Montana. The subsidiary will be named Montana Benefits and Health Connections.
      New West will retain the 18 people in Kalispell currently employed by MBLC.
      "This is a monumental success for the people of Montana," said Morrison, Montana's Insurance Commissioner. "We have succeeded in protecting more than 11,000 Montana policyholders. If this rehabilitation plan had not been approved, the company would have been liquidated and policyholders could have been placed at great risk by not having health and life claims paid. Additionally, liquidation could have placed a great burden on Montana taxpayers."
      According to industry experts, less than five percent of insurance company rehabilitations are a success.
      In June 2001, the MBLC board of directors unanimously consented to the State Auditor taking MBLC into rehabilitation. For the past 15 months, the Auditor's office has worked aggressively to assure that policyholder claims were paid. Many administrative efficiencies were implemented, but the company needed a significant cash infusion to be rehabilitated.
      Current owners made numerous attempts to bring additional capital, but ultimately were unsuccessful.
      The court approved a plan based on New West's bid, which was the result of a process that allowed hundreds of bidders to participate.
      "This is a great day for Montana's insurance consumers, thanks to the dedication and hard work of the commissioner and the department of insurance," said Pat Aberle, chief executive officer of New West. "Through this plan, not only are the interests of the current MBLC insureds safeguarded, but the interests of the insureds of New West Health Services and Montana Benefits and Health Connections, and all health insurance consumers in Montana are furthered. New West and Health Connections are pleased to be integral parts of this rehabilitation plan, and look forward to the opportunity to provide the same high quality products and services to our new Health Connections members as we have always provided to our current New West members."