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This letter appeared in the May 1998 issue of The Insurance Forum.
Related articles include:

"Another Major Setback for Provident Mutual and the Mutual Holding
    Company Concept" (November 1999)
"Provident Mutual's Legal Snag — A Stunning Setback for the Mutual
    Holding Company Concept" (April 1999)
"The Pennsylvania Insurance Department's Approval of Provident Mutual's
    Anti-Policyowner Reorganization Plan" (January 1999)
"The Apparent Cover-up at Provident Mutual" (June 1998)
"Democracy at Provident Mutual — A Case Study in the Suppression of
    Communication among Policyholders" (May 1998)
"Provident Mutual and the Pennsylvania Insurance Department" (April 1998)
"The Mutual Holding Company — A Flawed Concept" (December 1997)

You can obtain them by calling The Insurance Forum at 812-876-6502.

A Letter to Provident Mutual Policyowners (March 20, 1998)

Important note: Blanket permission is hereby granted to reproduce this page,
provided that the page is reproduced in its entirety. The permission applies
only to this page; no other portion of the May 1998 issue of The Insurance
Forum may be reproduced in whole or in part without permission in writing
from The Insurance Forum, P.O. Box 245, Ellettsville, Indiana 47429.

Dear Provident Mutual Policyowner:

I urge you to join me in opposing the Plan of Conversion adopted by Provident
Mutual's board of directors on January 5, 1998. I have reviewed the plan. In my
opinion, it prejudices our interests. Here, in brief, are some of my concerns:

Provident's plan must be approved by the Pennsylvania insurance department.
In February, I submitted to the department a statement describing my concerns
about the plan in somewhat more detail. I would be pleased to send the statement
to you; I encourage you to write to me and ask for it. I would also welcome your
thoughts on Provident's plan. My mailing address is P.O. Box 245, Ellettsville,
Indiana 47429.

To introduce myself, I became a Provident policyholder in 1993, when
Continental American Life merged into Provident. I was an agent for Continental
in the 1950s, and bought my first Continental policy when I joined the company
in 1953. For further information, see the biographical sketch at the bottom of
this letter.

In January, shortly after Provident's board of directors adopted the plan,
Provident notified its policyowners of the board's action. Included in the
mailing was a six-page flyer describing the purported advantages of the plan.
Policyowners were offered a copy of the plan, and I obtained it.

Early in March, Provident notified its policyowners that a "public informational
hearing" concerning the plan was to be conducted by the Pennsylvania
department. The hearing was to be held on April 7 at the Valley Forge Hilton
Hotel near Philadelphia. I attempted to learn from the department about the
procedures to be followed at the hearing. I was told only that the hearing would
be informal, that it would resemble a "town meeting," and that the procedures
would be explained at the beginning of the hearing. By the time you see this
letter, the hearing will already have been held.

Later, after the Pennsylvania department has approved the plan (which I expect
the department to do), Provident will notify policyowners of a special meeting
to vote on the plan. Policyowners will be invited to attend the meeting, and also
will be offered an opportunity to vote on the plan by mail. I urge you to vote no.

When I submitted my statement to the Pennsylvania department, I also submitted
a letter addressed to my fellow policyowners. I asked the department to order
Provident to send my letter to the policyowners with the notice of the public
informational hearing. The department declined my request.

I then asked Provident to send my letter to the policyowners with the notice of
the public informational hearing. Provident declined my request.

I then asked Provident to mail at my expense a revised version of the letter,
together with my statement, to 5,000 policyowners within about 50 miles of
the location of the public informational hearing. Provident declined my request.

Again, I urge you to vote no to Provident's plan.

Sincerely,

Joseph M. Belth

Joseph M. Belth, Ph.D., is professor emeritus of insurance in the Kelley School
of Business at Indiana University, editor of The Insurance Forum, and author
of Life Insurance: A Consumer's Handbook. He is the author of several other
books and numerous journal articles. For one of his books he received the 1966
Elizur Wright award for "outstanding original contribution to the literature of
insurance." For The Insurance Forum he received a 1990 George Polk award.
He is a past president of the American Risk and Insurance Association, an
organization of insurance professors and others interested in insurance education.

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