AMENDED AND RESTATED NOTE


$26,000,000                                September 24, 1998


STANDARD MANAGEMENT CORPORATION, a corporation organized under the laws
of Indiana (the "Borrower"), for value received, hereby promises to pay
to the order of FLEET NATIONAL BANK, a national banking association
having an office at 777 Main Street, Hartford, Connecticut (the "Bank"),
the principal sum of TWENTY SIX MILLION DOLLARS ($26,000,000), or, if
less, the amount loaned by the Bank to the Borrower pursuant to the
Revolving Line of Credit Agreement referred to below, in lawful money of
the United States of America and in immediately available funds, on the
date(s) and in the manner provided in said Agreement. The Borrower also
promises to pay interest on the unpaid principal balance hereof, for the
period such balance is outstanding, at said principal office, in like
money, at the rates of interest as provided in the Agreement described
below, on the date(s) and in the manner provided in said Agreement.

The date and amount of each type of loan made by the Bank to the Borrower
under this Note and the Agreement referred to below, and each payment of
principal thereof, shall be recorded by the Bank on its books and, prior
to any transfer of this Note (or, at the discretion of the Bank, at any
other time), endorsed by the Bank on the schedule attached hereto or any
continuation thereof.

This is the Note referred to in that certain Amended and Restated
Revolving Line of Credit Agreement dated as of November 8, 1996 by and
between the Borrower and the Bank, as amended by that certain Amendment
No. 1 to Amended and Restated Revolving Line of Credit Agreement dated
March 10, 1998 by and between the Borrower and the Bank, as amended by
that certain Amendment No. 2 to the Amended and Restated Revolving Line
of Credit Agreement dated as of the date hereof by and between the
Borrower and the Bank (as further amended from time to time the
"Agreement"), and evidences the Loans issued by the Bank thereunder.  All
terms not defined herein shall have the meanings given to them in the
Agreement.

The Agreement provides for the acceleration of the maturity of principal
upon the occurrence of certain Events of Default and for prepayments on
the terms and conditions specified therein.

The Borrower waives presentment, notice of dishonor, protest and any
other notice or formality with respect to this Note.

This Note is being substituted for and replaces that certain Amended and
Restated Note dated March 10, 1998 in the principal amount of $20,000,000
made by the Borrower in favor of the Bank.  Nothing herein shall be
construed to constitute payment or discharge of any of the indebtedness
due and owing under said prior promissory note.

This Note shall be governed by, and interpreted and construed in
accordance with, the laws of the State of Connecticut.

STANDARD MANAGEMENT CORPORATION



By________________________________
Name:Stephen M. Coons, Esq.
Title:Executive Vice President and
General Counsel
<PAGE>




<TABLE>
<CAPTION>
                   Amount of Loan   Amount of Payment      Balance
      DATE                                               Outstanding       Notation By
<S>               <C>               <C>               <C>               <C>
</TABLE>