On April 30, 2013, the Pennsylvania Insurance Commissioner (Rehabilitator) filed rehabilitation plans for Penn Treaty Network America Insurance Company (Penn Treaty) and its subsidiary American Network Insurance Company (ANIC). These filings are in response to the Commonwealth Courts directive contained in its May 3, 2012 order denying the Rehabilitators liquidation petitions. The rehabilitation plans filed with the Court are subject to further review and possible modifications by the Court before they can be implemented. There will be opportunities for public comment.

Policyholders are our first priority. We have also filed an Application to Facilitate the Creation of a Committee of Policyholders to give policyholders a direct voice over these plans. Moreover, the rehabilitation plans attempt to minimize the amount of financial hardship to policyholders. Policyholders who pay their premiums will continue to have coverage.

The rehabilitation plans attempt to address Penn Treaty and ANICs liabilities through benefit modifications on a temporary basis, possible premium rate increases, and several other measures. Should the companies assets and future revenues become more than adequate to meet future policy obligations, the Rehabilitator may begin restoring those benefit modifications.

While these matters can take time, we will continue our efforts to communicate with policyholders. Policyholder operations continue on-site at the companys Allentown headquarters. Copies of these proposed plans are posted in the rehabilitation section of www.PennTreaty.com.

If policyholders have questions, they should use their points of contact at Penn Treaty. For claims questions, dial 1-800-362-0700 ext. 3190. For rehab plans questions, dial 1-800-362-0700 ext. 3270.