August 9, 2004

Kemper and Kenning Financial Advisors, LLC announced today that Acting President, CEO and CFO Mike Coutu has resigned and that Kemper and Kenning mutually terminated the contract under which Kenning provided management services for Kemper's run-off planning and operations. A search for a new Kemper CEO is currently underway, and the selection process is expected to be completed soon. In the meantime, the company's current management team will report to COO Doug Andrews.

"We asked Mike Coutu to map out a run-off plan for Kemper, and he has done that with the concurrence of the Illinois Division of Insurance and certain other states as members of the National Association of Insurance Commissioners," said Kemper Chairman Dave Mathis. "Our policyholders were fortunate to have Mike's leadership at recent critical times for our company, and we are grateful for all his contributions and the experience and expertise that he and Kenning brought to us. As we move deeper into implementing the plan he developed, Mike and the board of directors agreed that it was a good time for transition."

Two members of the Kenning team will remain with Kemper to assist in the ongoing run off. In addition to Doug Andrews' role as COO, Bud Schwartz will stay on as transactional counsel. Harold Marsh had previously decided to resign effective September 30 to return to his home state of California.

A town hall meeting will be scheduled soon to discuss these developments as well as review the six-month financial results.