The Architect of Life Settlements SM

2. The Architect of Life SettlementsSM a NASDAQ Global Market company

3. What Are Life Settlements? • A Life Settlement is the purchase of an existing life insurance policy at a discount to its face amount. • Policyholders are financially sophisticated individuals or trusts who purchased policies for estate planning or other financial purposes and no longer need the coverage.

4. Life Settlements were recognized as a legal transaction by the U.S. Supreme Court in 1911. History and Legal Basis • Life Settlements were developed in order to meet the needs of individuals who have life insurance they no longer want or need.

5. Why Invest in Life Settlements? Inherent Asset Value of Life Settlements Even during the Great Depression, life insurance companies still paid their policy obligations. Generation of True Alpha Life Settlements are immune from fluctuations in the stock and bond market, interest rates and business cycles. • Risk Amelioration • Because the key factors affecting yield are initial discount and time, rather than economic conditions, exceptional returns can be realized with low risk to investment capital.

6. HOW DOES A LIFE SETTLEMENT TRANSACTION WORK?

7. STEP ONE • Seller • $1,000,000 policy is presented to LPI, either from the owner of the policy or by a representative of the owner (called a broker) for consideration of an offer. • The insured is purported to have a life expectancy of 5-7 years.

8. STEP TWO • Life Partners, Inc. • LPI analyzes the policy to ensure: • Policy is fully transferable, past contestability period and there are no foreseeable impediments to future payout; and • LPI’s independent medical consultant gives opinion that life expectancy of insured is 5-7 years. • LPI offers to purchase policy on behalf of its clients based on market demand and economic analysis of policy.

9. STEP THREE • Purchaser • Must be an accredited investor. • Minimum investment amount is $50,000. • Investor may purchase a fractional portion or the entire policy. • Qualified or non-qualified funds are acceptable. • Investor signs Agency Agreement. • Investor signs a Policy Funding Agreement (PFA) for each purchase. • Funds are sent to independent escrow agent, NOT to LPI.

10. STEP FOUR • Independent Escrow Agent • Holds original policy, PFA, and funds for the acquisition. • Holds investment funds and policy documents and verifies transfer with insurance company • Disburses and distributes funds at closing as follows: • a. Full payment to insured • b. Policy premiums are escrowed for life expectancy of insured • c. Escrow Agent’s service fees • d. Fees payable to LPI

11. STEP FIVE • Independent Escrow Agent and Purchaser • When policy matures, Escrow Agent pays to investor his pro rata share of all proceeds paid out by insurance company under the policy. • ROI varies with each purchase depending on cost basis, holding period, return of unused premiums or additions to premium escrow needed to maintain policy and amount paid out under policy. • Purchaser has opportunity to have Escrow Agent hold all or a portion of payout for reinvestment or receive entire payout as Purchaser may direct.

12. WHAT KIND OF RETURNS ARE POSSIBLE WITH LIFE SETTLEMENTS?

13. Potential Yield Curves Yields not adjusted for return of premium escrow or additional escrow requirements

14. Yield Curves Excluding Extraordinary Performance Yields not adjusted for return of premium escrow or additional escrow requirements

15. The Buzz About Life Settlements The New York Times: “Last year, for instance, insurance companies reduced their financial exposure by $1.1 trillion when 19.8 million policyholders stopped paying premiums, according to the Insurance Information Institute. In comparison, the industry paid death benefits on only 2.2 million policies.” - Charles Duhigg, “Late in Life, Finding a Bonanza in Life Insurance” December 17, 2006 The Wall Street Journal: “A life insurance policy is the property of the insuree, and he or she can sell it to somebody else.” - Holman W. Jenkins, Jr, “Life Insurers Face the Future, Grudgingly” August 9, 2006

16. 2007 Conning Life Settlement Research Report For over 50 years, Conning Research & Consulting, Inc. has been a source of independent research company which provides insurance industry analysis to insurers and industry stakeholders. As a result of its wealth of experience and intimate knowledge of the insurance industry, Conning is widely recognized for its in-depth insights and analyses on a wide range of industry products and issues. Conning is headquartered in Hartford, CT. Conning recently issued a report entitled Life Settlement Market: Increasing Capital and Investor Demand 2007. This report frequently references Life Partners and provides a wealth of information and independent analysis on the current and future of the life settlement industry.

17. Conning Research: Noncorrelated Diversification “Life settlements provide noncorrelated diversification because insurance policies are independent of the factors contributing to economic downturns such as interest rate fluctuations and increasing fuel costs. For investors who have a large portion of their assets in equity or debt, adding life settlements as an alternative investment is one way to reduce a portfolio’s exposure to sudden downturns in the stock or bond markets. Noncorrelation should not be understood as being risk-free. There is investment risk associated with life settlements. However, this growing desire for noncorrelated assets among investors, especially when equity and debt markets are volatile, points to a continued flow of capital seeking life settlements.” - page 42

18. Conning Research: LPI’s Direct Purchase Services “Some life settlement investors pursue an active strategy in life settlements. They identify, evaluate, and purchase individual policies. They purchase these policies from either from an individual owner or from a life settlement provider. This approach provides the investor with the highest level of control because they conduct the evaluation and choose which policies to purchase. It also lowers their investment costs because they do not pay management fees to a portfolio manager. Because of the lower fees, and potentially lower transaction costs, active investors may realize a higher return on their investment than passive investors. However, this approach also carries with it a high risk if the investor is unable to purchase a diverse portfolio of policies.” - page 56-57

19. Conning Research: The Economics of Life Settlements “It is important to realize that the life settlement marketplace is built on a structural inefficiency in the current life insurance industry. Insurers are unable to reprice policies once issued. Life insurers, even if made aware of the new information, are unable to adjust their surrender value; in essence, they are locked into the status of always being the lowest market price.” - page 37

20. Conning Research: The Future LS Market “According to the CDC, at least 80% of older Americans have at least one chronic condition and 50% have two. Aging Baby Boomers are already experiencing chronic health conditions. Those above the age of 75 find that 53% have high blood pressure, 37% have heart diseases and 15% are diabetic. The possibility exists that Boomers may face an even steeper decline in health than their parents. If that proves to be the case, then the potential market for life settlements may increase to an even larger number.” - page 31

21. Conning Projected Gross Market Size by Face Value Source: Conning Research & Consulting, Inc.- 2007

22. Bernstein Projected Gross Market Size Source: Sanford C. Bernstein & Co.- 2005

23. Conning Forecast of Annual Life Settlement Volume Source: Conning Research & Consulting, Inc. - 2007

24. WhoDOESN’T Like Life Settlements? Insurance Companies • Why? • Lapsed Policies= HUGE PROFITS • Most Policies Lapse By Year 10 • Policies are priced to market and lapse factor, not to mortality of insured • According to the American Council of Life Insurers, approximately 8.5% or $1.4 Trillion in coverage is voluntarily terminated EVERY YEAR!

25. The Life Partners Edge • Key Employee Retention – 12 year average • Substantial Intellectual Capital • Oldest company in industry – well established broker relationships with an excellent business reputation • Extensive investment in developing proprietary software and processes for high volume of transactions • Only publicly traded company operating exclusively in the life settlement industry

26. Life Partners History • Life Partners, Inc. founded in Waco, Texas in 1991 by Brian Pardo • Developed business and legal processes to transact high volume of life settlements • Went public in 2000 via reverse merger in order to demonstrate financial transparency and foster public confidence • LPI became wholly owned subsidiary of Life Partners Holdings, Inc. – began trading on OTC market

27. Life Partners History • Originated concept of life settlements for high net worth seniors in 1997 • Qualified for NASDAQ Small Cap in 2003 and NASDAQ Global Market in 2007 • Market Capitalization exceeds $100 million in 2007 • Consistent history of quarterly dividend payments since 2002

28. LPHI Officers (front row L to R)R. Scott PedenSecretary/General Counsel President, Life Partners, Inc.Brian D. PardoChief Executive OfficerNina PiperChief Financial OfficerLPI Officers (back row L to R)Deborah CarrVice-President, AdministrationMark EmbryChief Operating OfficerKurt CarrVice-President, Policy Analysis LIFE PARTNERS HOLDINGS, INC. (NASDAQ GM: LPHI)