355429--2/27/2009--PROTECTIVE_LIFE

related topics

{condition, economic, financial}

{loss, insurance, financial}

{capital, credit, financial}

{acquisition, growth, future}

{regulation, change, law}

{financial, litigation, operation}

{competitive, industry, competition}

{system, service, information}

{operation, natural, condition}

{product, liability, claim}

{property, intellectual, protect}

{tax, income, asset}

{regulation, government, change}

The Company is exposed to the risks of natural disasters, pandemics, malicious and terrorist acts that could adversely affect the Company's operations. The Company operates in a mature, highly competitive industry, which could limit its ability to gain or maintain its position in the industry and negatively affect profitability. A ratings downgrade or other negative action by a ratings organization could adversely affect the Company. The Company's policy claims fluctuate from period to period resulting in earnings volatility. The Company's results may be negatively affected should actual experience differ from management's assumptions and estimates. The Company's valuation of its investments, financial condition or results of operations could be adversely impacted by results that differ from its expectations or assumptions. The use of reinsurance introduces variability in the Company's statements of income. The Company could be forced to sell investments at a loss to cover policyholder withdrawals. Interest rate fluctuations could negatively affect the Company's spread income or otherwise impact its business. Equity market volatility could negatively impact the Company's business. Insurance companies are highly regulated and subject to numerous legal restrictions and regulations. Changes to tax law or interpretations of existing tax law could adversely affect the Company and its ability to compete with non-insurance products or reduce the demand for certain insurance products. The Company may be required to establish a valuation allowance against its deferred tax assets, which could materially adversely affect the Company's results of operations, financial condition and capital position. Financial services companies are frequently the targets of litigation, including class action litigation, which could result in substantial judgments. Publicly held companies in general and the financial services industry in particular are sometimes the target of law enforcement investigations and the focus of increased regulatory scrutiny. The Company's ability to maintain competitive unit costs is dependent upon the level of new sales and persistency of existing business. The Company's investments are subject to market, credit, legal and regulatory risks. These risks could be heightened during periods of extreme volatility or disruption in financial and credit markets. The Company may not realize its anticipated financial results from its acquisitions strategy. The Company may not be able to achieve the expected results from its recent acquisition. The Company is dependent on the performance of others. The Company's reinsurers could fail to meet assumed obligations, increase rates or be subject to adverse developments that could affect the Company. The occurrence of computer viruses, network security breaches, disasters or other unanticipated events could affect the data processing systems of the Company or its business partners and could damage the Company's business and adversely affect its financial condition and results of operations. The Company's ability to grow depends in large part upon the continued availability of capital. New accounting rules, changes to existing accounting rules, or the grant of permitted accounting practices to competitors could negatively impact the Company. The Company's risk management policies and procedures could leave it exposed to unidentified or unanticipated risk, which could negatively affect our business or result in losses. Credit market volatility or disruption could adversely impact the Company's financial condition or results from operations. Disruption of the capital and credit markets could negatively affect the Company's ability to meet its liquidity and financing needs. Difficult conditions in the economy generally could adversely affect the Company's business and results from operations. Continued deterioration of general economic conditions could result in a severe and extended economic recession, which could materially adversely affect the Company's business and results of operations. There can be no assurance that the actions of the U.S. Government or other governmental and regulatory bodies for the purpose of stabilizing the financial markets will achieve their intended effect. The Company may not be able to protect its intellectual property and may be subject to infringement claims. An inability to access our credit facility could adversely affect the Company. The amount of statutory capital that the Company has and the amount of statutory capital that it must hold to maintain its financial strength and credit ratings and meet other requirements can vary significantly from time to time and is sensitive to a number of factors outside of the Company's control.

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355429--2/27/2009--PROTECTIVE_LIFE_CORP