AMERICO LIFE INC
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>15
<FILENAME>exhibit14.txt
<TEXT>

5













                                 EXCESS OF LOSS
                              REINSURANCE AGREEMENT
                          (hereinafter the "Agreement")

                              Entered into Between


                          MANULIFE REINSURANCE LIMITED
                                       of
                                Hamilton, Bermuda
                       (hereinafter the "Ceding Company")


                                       AND


              AMERICO FINANCIAL LIFE AND ANNUITY INSURANCE COMPANY (formerly
           "The College Life Insurance Company of America")
                                       of
                                  Dallas, Texas
                          (hereinafter the "Reinsurer")






                                                                 October 1, 2000

<PAGE>





                                Table of Contents


                                                                          Page
ARTICLE I   GENERAL PROVISIONS                                              3
ARTICLE II  REINSURANCE PREMIUMS                                            5
ARTICLE III BENEFIT PAYMENTS                                                5
ARTICLE IV  OVERRIDE COMMISSION                                             6
ARTICLE V   ACCOUNTING AND SETTLEMENTS                                      6
ARTICLE VI                 DURATION                                         7
ARTICLE VII                TERMINAL ACCOUNTING AND SETTLEMENT               9
ARTICLE VIII               PROXY TAX                                        9
ARTICLE IX                 ARBITRATION                                     11
ARTICLE X                  GOVERNING LAW                                   12
ARTICLE XI                 INSOLVENCY                                      12
ARTICLE XII                REPRESENTATIONS AND WARRANTIES                  13
ARTICLE XIII               EXECUTION AND EFFECTIVE DATE                    14
SCHEDULE A                 QUARTERLY REPORT OF ACTIVITY AND SETTLEMENT     15
SCHEDULE B                 NOVATION                                        16

                                 EXCESS OF LOSS

                              REINSURANCE AGREEMENT


The Ceding Company and the Reinsurer mutually agree to reinsure on the terms and
conditions stated herein. This Agreement is an indemnity reinsurance agreement
solely between the Ceding Company and the Reinsurer, and performance of the
obligations of each party under this Agreement will be rendered solely to the
other party. In no instance will anyone other than the Ceding Company or the
Reinsurer have any rights under this Agreement, and the underlying direct
writing companies will be and remain solely liable to any insured, policyowner
or beneficiary under any policy reinsured hereunder.

                                    ARTICLE I

                               GENERAL PROVISIONS


1.   Policies and Risks  Reinsured.  The Reinsurer agrees to indemnify
     the Ceding Company for, and the Ceding Company agrees to reinsure
     with the Reinsurer, according to the terms and conditions hereof,
     the  excess of loss  portion  of the risks  assumed by the Ceding
     Company under the Coinsurance and Modified Coinsurance  Agreement
     numbered  5073  effective as of October 1, 2000 (the  "Underlying
     Agreement")  by and  between  the Ceding  Company  and  Employers
     Reassurance Corporation ("Underlying Ceding Company").

 2.      Coverages  and   Exclusions.   Only  the  risks  reinsured  under  the
         Underlying  Agreement are reinsured  under this Agreement.

 3.     Expenses.  The  Reinsurer  will bear no part of the  expenses
        incurred  in  connection  with the risks  reinsured hereunder, except
        as otherwise provided herein.

 4.     No Extracontractual Damages. The Reinsurer does not indemnify the Ceding
        Company for, and will not be liable for, any extracontractual damages or
        extracontractual liability resulting from fraud, oppression, bad faith,
        strict liability, or negligent, reckless or intentional wrongs on the
        part of the Ceding Company or its directors, officers, employees and
        agents. The following types of damages are examples of damages that
        would be excluded from this Agreement for the conduct described above:
        actual damages, damages for emotional distress, and punitive or
        exemplary damages.

 5.     Inspection. At any reasonable time, the Reinsurer may inspect, during
        normal business hours, at the principal office of the Ceding Company,
        the original papers and any and all other books or documents relating to
        or affecting reinsurance under this Agreement. The Reinsurer will not
        use any information obtained through any inspection pursuant to this
        Paragraph for any purpose not relating to reinsurance hereunder.

6.      Misunderstandings and Oversights. If any failure to pay amounts due or
        to perform any other act required by this Agreement is unintentional and
        caused by misunderstanding or oversight, the Ceding Company and the
        Reinsurer will adjust the situation to what it would have been had the
        misunderstanding or oversight not occurred.

7.     Currency.  All  amounts  in this  Agreement  are in U.S.  dollars
       unless specified otherwise. Any  amounts payable in currency other than
       U.S. dollars shall be paid in U.S. dollars at the  rate(s) of  exchange
       as agreed by the  parties or at the rate of exchange on the date that
       payment was made.

8.    Assignment. Neither party may assign any of its rights, duties or
      obligations under this Agreement without prior written consent of the
      other party.

9.    Amendments. This Agreement may be amended only by written agreement
      of the parties.

10.     Entire Agreement. The terms expressed herein constitute the entire
        agreement between the parties with respect to the risks reinsured
        hereunder. There are no understandings between the parties with respect
        to the risks reinsured hereunder other than as expressed in this
        Agreement. Except where otherwise indicated herein, the words and terms
        in this agreement shall have the same meaning as given in the Underlying
        Agreement.

11.     Severability. In the event that any provision or term of this Agreement
        shall be held to be illegal or unenforceable, all of the other terms and
        provisions shall remain in full force and effect, except if the
        provision or term held to be illegal or unenforceable is also held to be
        a material part of this Agreement such that the party in whose favor the
        material term or provision was stipulated herein would not have entered
        into this Agreement without such term or provision, then the party in
        whose favor the material term or provision was stipulated shall have the
        right, upon such holding, to terminate this Agreement.

12.     Non-Waiver of Rights. No forbearance on the part of either party to
        insist upon compliance by the other party with the terms of this
        Agreement shall be construed as, or constitute a waiver of, any of the
        terms of this Agreement.

13.     Survival of Representations and Warranties. All obligations,
        representations and warranties made in this Agreement shall survive the
        termination of this Agreement and shall continue in full force and
        effect until all obligations of the parties hereunder have been
        discharged in full.


<PAGE>



                                    ARTICE II

                              REINSURANCE PREMIUMS

At the end of each Accounting Period, the Ceding Company will pay the Reinsurer,
with respect to the risks reinsured under the Agreement, Reinsurance Premiums
equal to the greater of zero and (a) less (b) where:

         (a)    equals any positive settlement amounts collected by the Ceding
                Company on the Underlying Agreement including any interest on
                delayed payments received by the Ceding Company and

         (b)    equals any Cumulative Loss Carry Forward amounts as defined in
                Article III increased by a proportionate share of any interest
                on delayed payments received by the Ceding Company in (a) above.


The Loss Carry Forward Repayment for a given Accounting Period is defined as the
lesser of (a) and (b) above.



                                   ARTICLE III

                                BENEFIT PAYMENTS

At the end of each Accounting Period, the Reinsurer will pay the Ceding Company,
with respect to the risks reinsured under the Agreement, Benefit Payments equal
to the greater of (a) zero and (b) any settlement amounts payable by Ceding
Company on the Underlying Agreement less $25,000. The resulting unreimbursed
amount (the lesser of $25,000 or the absolute value of any negative settlement
on the Underlying Agreement) will be considered a Loss Carry Forward.

A Cumulative Loss Carry Forward will be calculated as (a) plus (b) less (c)
where:

(a)    equals the Cumulative Loss Carry Forward from the prior Accounting Period
       with interest at the annualized rate equal to the 3 month U.S. Treasury
       Bill discount rate as of the end of the prior Accounting Period plus 2%
       (the annualized rate will be adjusted to a quarterly rate by dividing the
       rate by four);
(b)      equals the current Accounting Period Loss Carry Forward; and
(c)      equals any Loss Carry Forward Repayment for the current Accounting
         Period per Article II.


<PAGE>



                                   ARTICLE IV

                               OVERRIDE COMMISSION

At the end of each Accounting Period, the Reinsurer will pay the Ceding Company
an Override Commission equal to fifty (50) basis points multiplied by the
Unamortized Ceding Commission at the start of the quarter, where the Unamortized
Ceding Commission is in accordance with the Underlying Agreement. The Override
Commission will be increased by a proportionate share of any interest on delayed
payments received by the Ceding Company noted in Article II, item a.


                                    ARTICLE V

                           ACCOUNTING AND SETTLEMENTS

 1.     Quarterly Accounting Period. Each Accounting Period under this Agreement
        will be a calendar quarter, except that: (a) the initial Accounting
        Period runs from the Effective Date of this Agreement through December
        31, 2000, and (b) the final Accounting Period runs from the end of the
        preceding Accounting Period until the terminal accounting date of this
        Agreement as described in Article VII, Paragraph 2.

 2.     Quarterly Accounting Reports. Accounting reports in the form of Schedule
        A will be submitted to the Reinsurer by the Ceding Company for each
        Accounting Period not later than fifteen (15) days after the Ceding
        Company receives the Underlying Ceding Company's report under the
        Underlying Agreement for such Accounting Period. Such reports will
        include information on the amount of Reinsurance Premiums, Benefit
        Payments, and the Override Commission.

 3.     Quarterly Settlements. If the amount shown in Paragraph 2 is due the
        Reinsurer, the Ceding Company's payment thereof shall accompany the
        report, provided that the Ceding Company has received all amounts from
        the Underlying Ceding Company under the Underlying Agreement. If the
        amount shown in Paragraph 2 is due the Ceding Company, the Reinsurer
        shall make its payment thereof to the Ceding Company within 15 days
        after receiving the report.

 4.     Estimations. If the amounts, as defined in Paragraph 2 above, cannot be
        determined at such dates on an exact basis, such payments will be paid
        in accordance with a mutually agreed upon formula which will approximate
        the actual payments. Adjustments will then be made to reflect actual
        amounts when they are available.

 5.     Delayed Payments. For purposes of Paragraph 3 above, if there is a
        delayed settlement of a payment due, there will be an interest penalty,
        at an interest rate equal to the prevailing 3 month U.S. Treasury Bill
        discount rate on the date the payment becomes overdue plus 2%, for the
        period that the amount is overdue.

 6.     Offset of Payments. Any debts or credits, matured or unmatured,
        liquidated or unliquidated, regardless of when they arose or were
        incurred, in favor of or against either the Ceding Company or the
        Reinsurer with respect to this Agreement or with respect to any other
        claim of one party against the other are deemed mutual debts or credits,
        as the case may be, and only the balance shall be allowed or paid. In
        the event of insolvency of the Ceding Company or the Reinsurer, offsets
        shall be allowed in accordance with applicable law.

                                   ARTICLE VI

                                    DURATION


1.       Reinsurer's Liability. The liability of the Reinsurer with respect to
         the risks reinsured hereunder will begin simultaneously with that of
         the Ceding Company, but not prior to the Effective Date of this
         Agreement. The Reinsurer's liability with respect to any risk reinsured
         hereunder will terminate on the earlier of: (i) the date such risk is
         recaptured by the Underlying Ceding Company under the Underlying
         Agreement or (ii) the date this Agreement is terminated or commuted
         pursuant to this Article. Termination of the Reinsurer's liability is
         subject to payments in respect of such liability in accordance with the
         provisions of Article VII of this Agreement.

         If any event or defect occurs that would give rise to a right of any
         party to terminate the Underlying Agreement, the Ceding Company shall
         provide 10 days written notice of such event to the Reinsurer.

2.       Period of Duration. Upon the earlier of:
----------------------------

(a)      the first day of the Accounting Period immediately following
         complete amortization of the Unamortized Ceding Commission,
         per the Underlying Agreement;

(b)      a date specified by the Reinsurer in accordance with Paragraph 3 of
         this Article; and

(c)      July 1, 2006

         the Reinsurer shall assume all of the Ceding Company's rights and
         obligations under the Underlying Agreement between the Ceding Company
         and the Underlying Ceding Company (the "Assumption"). Upon the
         Assumption, the parties hereto shall execute, and take all necessary
         steps to cause the Underlying Ceding Company to execute, a Novation
         Agreement substantially in the form attached as Schedule B, effective
         as of the date of the Assumption.

         Immediately following the Agreement, this Agreement shall be commuted
         and the Reinsurer shall pay the Commutation Compensation to the Ceding
         Company within 30 days of the Assumption. For the purposes of this
         Agreement, "Commutation Compensation" shall mean the amount equal to
         the sum of the following: (i) the Cumulative Loss Carryforward on the
         date of commutation, (ii) any amounts otherwise due and payable by the
         Reinsurer to the Ceding Company under this Agreement which have not
         been settled on the date of commutation; and (iii) any interest due on
         items (i) and (ii) above.

         The effect of the Assumption and subsequent commutation of this
         Agreement shall be that the parties agree to a commutation of this
         Agreement in accordance with this Article and that the Ceding Company
         and Reinsurer will be released from all liability under this Agreement.

3.       Early Assumption. In accordance with Paragraph 2 of this Article,
         Assumption shall occur at the Reinsurer's option upon 60 days written
         notice to the Ceding Company on any date specified below, subject to
         the Reinsurer satisfying the payment conditions stated therein:

(a)           On a date after January 1, 2005 or the first day of any Accounting
              Period when the Unamortized Ceding Commission is less than
              $5,000,000, subject to the payment to the Ceding Company of the
              Commutation Compensation;

(b)           On a date between January 1, 2004 and December 31, 2004, including
              those dates, subject to the payment to the Ceding Company of the
              Commutation Compensation plus 1% of the Unamortized Ceding
              Commission on the date of the commutation; or

(c)           On a date between January 1, 2003 and December 31, 2003, including
              those dates, subject to the payment to the Ceding Company of the
              Commutation Compensation plus 2% of the Unamortized Ceding
              Commission on the date of the commutation.



<PAGE>



                                   ARTICLE VII

                       TERMINAL ACCOUNTING AND SETTLEMENT

1.       Terminal Accounting. In the event that this Agreement is terminated in
         accordance with Article VI, or the liability of the Reinsurer with
         respect to all risks reinsured hereunder is otherwise terminated in
         accordance with Article VI, the Ceding Company shall furnish to the
         Reinsurer a Terminal Accounting and Settlement not later than fifteen
         (15) days after the Ceding Company receives the Underlying Ceding
         Company's report under the Underlying Agreement for the final
         Accounting Period..

   2.   Date.  The terminal  accounting  date will be the  effective
        date of termination or any other date mutually  agreed to in
        writing.

   3.   Settlement.  The Terminal  Accounting  and  Settlement  will
        consist of the amounts  described in Article VI,  payable to
        the Ceding Company

        Such amount will be paid by the Reinsurer to the Ceding Company within
        thirty (30) days after the receipt of the Terminal Accounting and
        Settlement.

        The Reinsurer and the Ceding Company each agree to pay the other simple
        interest, at the prevailing 3 month U.S. Treasury Bill discount rate
        plus 2% as determined on the day the accounts are due, on all amounts
        due and not remitted when due.

3.      Supplementary Accounting and Settlement. In the event that, subsequent
        to the Terminal Accounting and Settlement as provided above, a change is
        made with respect to any amounts due, a supplementary accounting will
        take place pursuant to Paragraph 3 above. Any amount owed to the Ceding
        Company or to the Reinsurer by reason of such supplementary accounting
        will be paid promptly upon the completion thereof.

                                  ARTICLE VIII

                                    PROXY TAX

     1. Proxy Tax  Reimbursement.  Pursuant  to IRC  Section 848 as added by the
Revenue  Reconciliation  Act  of  1990,  insurance  companies  are  required  to
capitalize  and  amortize  specified  policy  acquisition  expenses.  The amount
capitalized is determined by proxy based on a percentage of net premiums. At the
Reinsurer's  request,  the Ceding  Company will  reimburse the Reinsurer for any
positive  timing cost to the Reinsurer which results from the application of IRC
Section 848 to the risks reinsured  hereunder and which the Reinsurer  considers
material.  At the Ceding  Company's  request,  the Reinsurer  will reimburse the
Ceding  Company  for the  absolute  value  of any  negative  timing  cost to the
Reinsurer  which  results from the  application  of IRC Section 848 to the risks
reinsured  hereunder  and which  the  Ceding  Company  considers  material.  The
Reinsurer  and the Ceding  Company  agree,  however,  that any timing cost which
would  result from the  regulations  published  on  December  29,  1992,  by the
Internal  Revenue  Service  under IRC Section 848 would not be material and thus
not subject to reimbursement  hereunder.  The Ceding Company and Reinsurer agree
to negotiate  in good faith if the tax  circumstances  of the parties  change or
changes in the tax code create  unanticipated  adverse  economic affects for one
party and offsetting favorable consequences for the other.

     2. Election to Determine Specified Policy Acquisition Expenses.  The Ceding
Company and the Reinsurer  agree that the party with net positive  consideration
under this Agreement will capitalize  specified policy acquisition expenses with
respect to policies reinsured under this Agreement without regard to the general
deductions  limitation  of Section  848(c) (1) of the  Internal  Revenue Code of
1986, as amended. The Ceding Company and the Reinsurer will exchange information
pertaining to the amount of net consideration  under this Agreement each year to
ensure  consistency.  The Reinsurer will submit a schedule to the Ceding Company
by May 1 of each year  presenting its calculation of the net  consideration  for
the preceding  taxable year. The Ceding  Company may contest the  calculation in
writing  within  thirty (30) days of receipt of the  Reinsurer's  schedule.  Any
differences will be resolved between the parties so that consistent  amounts are
reported on the  respective  tax returns for the preceding  taxable  year.  This
election to capitalize  specified policy  acquisition  expense without regard to
the general  deductions  limitation  is effective  for all taxable  years during
which this Agreement remains in effect.

<PAGE>



                                   ARTICLE IX

                                   ARBITRATION


1.      Basis for Arbitration. The Ceding Company and Reinsurer mutually
        understand and agree that the wording and interpretation of this
        Agreement is based on the usual customs and practices of the insurance
        and reinsurance industry. While both Parties agree to act in good faith
        in its dealings with each other, it is understood and recognized that
        situations may arise in which they cannot reach an agreement.

        In the event that any dispute cannot be resolved to the Ceding Company
        and Reinsurer's mutual satisfaction, the dispute will first be subject
        to good-faith negotiation as described below in an attempt to resolve
        the dispute without the need to institute formal arbitration
        proceedings.

     2.  Negotiation.  Within  ten days after one of the  Parties  has given the
other  the first  written  notification  of the  specific  dispute,  each of the
Parties will appoint a designated officer to attempt to resolve the dispute. The
officers will meet at a mutually  agreeable location as early as possible and as
often  as  necessary,  in  order  to  gather  and  furnish  the  other  with all
appropriate and relevant  information  concerning the dispute. The officers will
discuss the problem and will  negotiate in good faith  without the  necessity of
any  formal  arbitration  proceedings.   During  the  negotiation  process,  all
reasonable  requests  made by one officer to the other for  information  will be
honored.  The  specific  format  for such  discussions  will be  decided  by the
designated officers.

        If the officers cannot resolve the dispute within thirty days of their
        first meeting, both Parties agree that they will submit the dispute to
        formal arbitration. However, the Ceding Company and Reinsurer may agree
        in writing to extend the negotiation period for an additional thirty
        days.

3.      Arbitration Proceedings. No later than fifteen days after the final
        negotiation meeting, the officers taking part in the negotiation will
        give both the Ceding Company and Reinsurer written confirmation that
        they are unable to resolve the dispute and that they recommend
        establishment of formal arbitration.

        An arbitration panel consisting of three active or retired officers of
        life insurance or reinsurance companies not affiliated with either the
        Ceding Company or Reinsurer in any way will settle the dispute. Each
        Party will appoint one arbitrator and the two will select a third. In
        the event that the arbitrators are unable to agree on a third arbitrator
        within sixty (60) calendar days from the date one of the arbitrators
        sends written notice to the arbitrator requesting that the arbitrators
        select a third arbitrator, then either party may petition the court to
        select the third arbitrator.

        Once the arbitration panel has been constituted, the third arbitrator
        shall contact the parties or their counsel in writing and request a
        telephone conference. The purpose of the telephone conference is to set
        a date when the parties, their counsel and the arbitration panel will
        meet to address organizational matters relating to the arbitration.

        The arbitration proceedings will be conducted according to the
        Commercial Arbitration Rules of the American Arbitration Association
        that are in effect at the time the arbitration begins.

        The arbitration will take place where the Reinsurer is located unless
        the Ceding Company and Reinsurer mutually agree otherwise.

        Within sixty days after the beginning of the arbitration proceedings the
        arbitrators will issue a written decision on the dispute and a statement
        of any award to be paid as a result. In resolving the merits of the
        parties' difference of opinion the arbitration panel is relieved from
        all judicial formalities and may abstain from following the strict rule
        of law, but shall interpret this Agreement as an honourable engagement
        and not merely a legal obligation. The arbitration panel shall make any
        interim and final award to effectuate the general purpose of the
        Agreement in a reasonable manner rather than in accordance with a
        literal or strictly legal interpretation of its language.

        The decision will be final and binding on both the Ceding Company and
        Reinsurer and there will be no further appeal.

        The Ceding Company and Reinsurer may mutually agree to extend any of the
        negotiation or arbitration periods shown in this Article.

        Unless otherwise decided by the arbitrators, the Ceding Company and
        Reinsurer will share in their proportion of all expenses resulting from
        the arbitration, including the fees and expenses for the arbitrators,
        except that each Party will be responsible for its own attorneys' fees.




                                    ARTICLE X

                                  GOVERNING LAW

This Agreement shall be interpreted and governed by the laws of the state of
Texas without regard to its rules with respect to conflict of law.


                                   ARTICLE XI

                                   INSOLVENCY

The Ceding Company and the Reinsurer agree that, in the event of the insolvency
of the Ceding Company, as to all reinsurance made, ceded, renewed or otherwise
becoming effective after the Effective Date of this Agreement, the reinsurance
shall be payable by the Reinsurer on the basis of the amount of liability of the
Ceding Company under the contract or contracts reinsured, without diminution
because of the insolvency of the Ceding Company; furthermore, that such amount
shall be paid directly to the Ceding Company or its liquidator, receiver or
other statutory successor.

It is understood and agreed, however, that the obligations of the Ceding Company
as set forth in this Agreement, including, among others, the duty to
investigate, settle and defend all claims arising under risks with respect to
which reinsurance is afforded by this Agreement, shall remain unimpaired and
unaffected by the insolvency of the Ceding Company and shall be assumed by the
liquidator, receiver or statutory successor of the Ceding Company in the
liquidation or receivership proceeding and that such liquidator, receiver or
statutory successor shall give written notice to the Reinsurer of the pendency
of a claim against the Ceding Company on the policy reinsured within a
reasonable time after such claim is filed in the insolvency proceeding and that
during the pendency of such claim the Reinsurer may investigate such claim and
inter-pose, at its own expense, in the proceeding where such claim is to be
adjudicated, any defense or defenses which it may deem available to the Ceding
Company, its liquidator, receiver or statutory successor. The expense thus
incurred by the Reinsurer shall be chargeable, subject to court approval,
against the insolvent Ceding Company as part of the expense of liquidation to
the extent of a proportionate share of the benefit which may accrue to the
Ceding Company solely as the result of the defense undertaken or asserted by the
Reinsurer.

Where two or more Reinsurers are involved in the same claim and a majority in
interest elect to interpose a defense to such claim, the expense shall be
apportioned in accordance with the terms of this Agreement as though such
expense had been incurred by the Ceding Company.

Nothing hereinabove set forth in this insolvency clause shall in anywise change
the relationship or status of the parties hereto, to wit, that of Ceding Company
and Reinsurer, nor enlarge the obligations of either party to each other, except
as specifically hereinabove provided, to wit, to pay the statutory successor on
the basis of the amount of liability of the Ceding Company under the contract or
contracts reinsured, rather than on the basis of the actual amount of loss
(dividends) paid by the liquidator, receiver or statutory successor to allowed
claimants, nor shall anything in this insolvency clause in any manner create any
obligations or establish any rights against the Reinsurer in favor of any third
parties or any persons not parties to this Agreement.

                                   ARTICLE XII

                         REPRESENTATIONS AND WARRANTIES

The Ceding Company and Reinsurer represent and warrant that all requisite
corporate authorizations, consents or approvals in connection with the
execution, delivery or performance of this Agreement have been obtained.


<PAGE>


                                  ARTICLE XIII

                          EXECUTION AND EFFECTIVE DATE

In order to reflect the Reinsurer's January 1, 2001 name change from The College
Life Insurance Company of America to Americo Financial Life and Annuity
Insurance Company effective upon the same date, the former company is deleted
and the latter company is substituted.

In witness of the above, this Agreement is executed in duplicate on the dates
indicated below with an Effective Date of October 1, 2000.


MANULIFE REINSURANCE LIMITED
("Ceding Company")


BY:        ____________________________        ATTEST: ______________________

TITLE:     ____________________________        TITLE: ________________________

DATE:      ____________________________        DATE: ________________________


AMERICO FINANCIAL LIFE AND ANNUITY INSURANCE COMPANY (formerly "The College Life
Insurance Company of America")
 ("Reinsurer")


BY:        ____________________________        ATTEST: ______________________

TITLE:     ____________________________        TITLE: ________________________

DATE:      ____________________________        DATE: ________________________



<PAGE>


                                             SCHEDULE A


                            QUARTERLY REPORT OF ACTIVITY AND SETTLEMENTS

                                  FROM CEDING COMPANY TO REINSURER


                    Accounting Period: _____________________

                  Date Report Completed: _____________________





1.       Reinsurance Premiums (Article II)           ___________________

2.       Benefit Payments (Article III)              ___________________

3.       Override Commission (Article IV)            ___________________

4.       Cash Settlement = 1 - 2 - 3                 ___________________

5.       Loss Carry Forward                          ___________________

6.       Loss Carry Forward Repayment                ___________________

7.       Cumulative Loss Carry Forward               ___________________




<PAGE>


                                             SCHEDULE B


                                              NOVATION

THIS NOVATION AGREEMENT is made as of [insert date of novation here] between The
College Life Insurance Company of Dallas, Texas or its successor ("College
Life"), Manulife Reinsurance Limited of Hamilton, Bermuda ("MRL"), and Employers
Reassurance Corporation of Overland Park, Kansas ( the "Company").

WHEREAS MRL and the Company are parties to a Coinsurance / Modified Coinsurance
Reinsurance Agreement dated October 1, 2000 (hereinafter referred to as the
"Reinsurance Agreement"); and WHEREAS as of [insert date here] (the "Effective
Date") the parties to this Novation Agreement have agreed to novate the
Reinsurance Agreement by substituting MRL with College Life, such that College
Life will assume all of MRL's interests, rights, duties, obligations and
liabilities under the Reinsurance Agreement and MRL will be relieved of all of
its interests, rights, duties, obligations and liabilities under the Reinsurance
Agreement; and WHEREAS the Company wishes to consent and agree to such novation.

NOW THEREFORE IN CONSIDERATION OF the mutual covenants and agreements
hereinafter set forth, the parties hereto agree as follows:

1)   College Life hereby assumes all interests, rights, duties, obligations, and
     liabilities of MRL under the Reinsurance Agreement. College Life further
     agrees with each of MRL and the Company that on the Effective Date, College
     Life shall be bound by all of the terms and conditions of the Reinsurance
     Agreement.

2)   The Company hereby releases MRL from all of its rights, duties, obligations
     and liabilities, express or implied, arising under the terms of the
     Reinsurance Agreement.

3)   Upon novation of this Agreement, the Company agrees that College Life may
     have the reinsurance basis converted to coinsurance by requesting that the
     Company transfer the assets held in escrow for the risks reinsured under
     the Reinsurance Agreement to College Life.

4)   The Reinsurance Agreement is accordingly amended by deleting the name of
     MRL wherever it appears and substituting therefore the name of College
     Life. In all other respects, the terms of the Reinsurance Agreement remain
     unaltered.

5)   College Life and the Company hereby ratify and confirm the Reinsurance
     Agreement is an agreement solely between them.

6)   Each  party  agrees to do all  things as may be  necessary  to give full
     effect to this Novation Agreement.

7)   This Novation Agreement shall enure to the benefit of and be binding upon
     the parties hereto and their respective successors and assigns.

8)   If any provision of this Novation Agreement is held to be invalid or
     unenforceable in whole or in part, such invalidity or unenforceability
     shall attach only to such provision or part thereof and the remaining part
     of such provision and all other provisions hereof shall continue in full
     force and effect.

9)   This Novation  Agreement  shall be governed by and construed in accordance
     with the law applicable to the Reinsurance Agreement.

IN WITNESS WHEREOF the parties have executed this Novation Agreement as of
[insert date here].


THE COLLEGE LIFE INSURANCE COMPANY OF AMERICA
By:      ________________________          By:      _________________________
Title:   ________________________          Title:   _________________________
Date:    ________________________          Date:    _________________________


MANULIFE REINSURANCE LIMITED
By:      __________________________        By:      _________________________
Title:   __________________________        Title:   _________________________
Date:    __________________________        Date:    _________________________

EMPLOYERS REASSURANCE CORPORATION

By:      ___________________________       By:      ___________________________
Title:   ___________________________       Title:   ___________________________
Date:    ___________________________       Date:    ___________________________





</TEXT>
</DOCUMENT>
