UNIVERSAL AMERICAN FINANCIAL CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
December 31, 2000 and 1999
(In thousands)

ASSETS                                                                    2000         1999   
Investments (Notes 2c and 5):
Fixed maturities available for sale, at fair value
 (amortized cost: 2000, $746,060; 1999, $734,466)  . . . . . . . . .  $  751,738   $  717,560
Equity securities, at fair value (cost: 2000, $3,819; 1999, $5,120)        3,547        4,838
Policy loans . . . . . . . . . . . . . . . . . . . . . . . . . . . .      25,077       25,640
Other invested assets  . . . . . . . . . . . . . . . . . . . . . . .       4,318        5,506 
Total investments  . . . . . . . . . . . . . . . . . . . . . . . . .     784,680      753,544

Cash and cash equivalents  . . . . . . . . . . . . . . . . . . . . .      40,250       58,753
Accrued investment income  . . . . . . . . . . . . . . . . . . . . .      11,459       11,506
Deferred policy acquisition costs (Note 2d)  . . . . . . . . . . . .      48,651       34,943
Amounts due from reinsurers (Note 11)  . . . . . . . . . . . . . . .     202,929      196,960
Due and unpaid premiums  . . . . . . . . . . . . . . . . . . . . . .       3,680        3,578
Deferred income tax asset (Note 6) . . . . . . . . . . . . . . . . .      65,014       70,968
Goodwill (Note 2o) . . . . . . . . . . . . . . . . . . . . . . . . .       6,712        4,201
Present value of future profits  . . . . . . . . . . . . . . . . . .       5,802        1,226
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . .      20,687       17,742 
 Total assets  . . . . . . . . . . . . . . . . . . . . . . . . . . .   1,189,864    1,153,421 

LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES
Policyholder account balances (Note 2e)  . . . . . . . . . . . . . .     223,681      238,665
Reserves for future policy benefits  . . . . . . . . . . . . . . . .     575,239      560,777
Policy and contract claims - life  . . . . . . . . . . . . . . . . .       7,207        5,644
Policy and contract claims - health  . . . . . . . . . . . . . . . .      77,884       72,261
Loan payable (Note 12) . . . . . . . . . . . . . . . . . . . . . . .      69,650       70,000
Amounts due to reinsurers  . . . . . . . . . . . . . . . . . . . . .       2,877           85
Restructuring liability (Note 4) . . . . . . . . . . . . . . . . . .       2,955        9,980
Negative goodwill (Note 2o and 4)  . . . . . . . . . . . . . . . . .       1,944        9,622
Other liabilities  . . . . . . . . . . . . . . . . . . . . . . . . .      54,478       52,422 
 Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . .   1,015,915    1,019,456 

Commitments and contingencies (Note 13)

STOCKHOLDERS' EQUITY (Note 8)
Common stock (Authorized: 80 million shares, issued and outstanding:
 2000, 46.8 million shares; 1999, 45.9 million shares) . . . . . . .         468          459
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . .     128,625      122,924
Accumulated other comprehensive income (loss)  . . . . . . . . . . .       4,875       (6,887)
Retained earnings  . . . . . . . . . . . . . . . . . . . . . . . . .      40,354       17,469
Less: Treasury Stock (0.1 million shares)  . . . . . . . . . . . . .        (373)           - 
 Total stockholders' equity  . . . . . . . . . . . . . . . . . . . .     173,949      133,965 

 Total liabilities and stockholders' equity  . . . . . . . . . . . .  $1,189,864   $1,153,421 

See notes to consolidated financial statements.