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ABILITY RE AND MEDICO COMPLETE TRANSACTION

Wednesday, October 17, 2007

(Omaha, NE) Today, Medico Insurance Company (MIC) and Ability Resources Inc.(ARI) announce that they have completed a transaction whereby MIC has sold its subsidiary, Medico Life Insurance Company (MLIC) to ARI. With this purchase, MIC has also sold its interest in its block of Long-Term Care insurance (LTC) closed to new business in 2004. Both parties have received the required approvals from the Nebraska Department of Insurance.

The initial phase of the transaction has MIC reinsuring its LTC business into MLIC and all MLIC reinsuring its non-LTC business into MIC. After these transactions, ARI acquired MLIC with the LTC business. It is expected that, over time, MLIC will move, through assumption, most of the LTC business onto its own balance sheet, and most of the non-LTC business directly to MIC.

Ability CEO Donald Charsky said, “We are excited about this acquisition and the opportunity to complete our platform for managing and administering closed blocks of business. We believe that this acquisition will be the first of many by which Ability will achieve scale through combining focused product knowledge with specialty management skills and substantial capital capacity.” MIC CEO Timothy Hall said, “This sale will position us well to grow our core businesses and remove the significant capital demands of a block of business that we were no longer selling.”

About Medico:
Medico Insurance Company provides health and life insurance products to consumers over the age of 50 throughout the United States. Medico was founded in 1930 and has its Home Office located in Omaha, Nebraska. For more information about Medico Insurance Company and Medico Group, visit gomedico.com.

About Ability:
Ability Resources Inc. is a wholly owned subsidiary of Ability Reinsurance Holdings, Ltd, a Bermuda-based holding company, recently financed by a consortium of investors, led by Oak Hill Capital, LLC and Haverford Capital,LLC. Its primary business is the application of an array of financial and service solutions to closed blocks of insurance business that are no longer strategic to their current owners. The investor group has committed $300 million to be drawn as needed to support the acquisition platform.

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Sherman & Company Served as Financial Advisor to Medico Insurance Company

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