Farm Bureau Insurance Firms Merge

July 9, 2002

The Farm Bureau property-casualty affiliates in Kansas (Farm Bureau Mutual Insurance Company, Inc.) and Nebraska (Farm Bureau Insurance Company of Nebraska) will merge into Farm Bureau Mutual Insurance Company. The Farm Bureau Mutual property-casualty pool currently operates predominantly in Iowa, Minnesota, South Dakota, Utah, Arizona and New Mexico.

These three mutual companies have signed a memorandum of understanding to merge operations and are working toward finalizing a definitive agreement. This merger is contingent upon regulatory approval and is expected to close during the first quarter of 2003.

"This is a tremendous opportunity for three strong Farm Bureau affiliated property- casualty insurers to merge and become a company with even greater financial strength, improved products and service, and more competitive pricing," stated Bill Oddy, CEO of Farm Bureau Mutual Insurance Company. "This merger is consistent with our philosophy that further consolidation within the Farm Bureau network of companies, whether it be mutual property-casualty companies or stock life companies, simply makes sense from every stakeholder's viewpoint."

Independent of each other, John Tatum and Michael Wilds, the top executives of the Nebraska and Kansas insurance operations, respectively, approached Oddy to discuss the possibility of merging.

Farm Bureau Mutual plans to preserve a presence in the current home offices in Manhattan, KS, and Lincoln, NE. These offices will become regional offices of Farm Bureau Mutual with sales support, underwriting, claims and other functions. In addition, the Manhattan Regional Office will become the center for the underwriting and administration of Farm Bureau Mutual's commercial property-casualty operations and Farm Bureau Mutual's call center will be located in the Lincoln Regional Office.