<PAGE>   1
                  1997 HARTFORD LIFE, INC. INCENTIVE STOCK PLAN


1. PURPOSE

The purpose of the 1997 Hartford Life, Inc. Incentive Stock Plan is to motivate
and reward superior performance on the part of employees of Hartford Life, Inc.
and its subsidiaries and Participating Companies and to thereby attract and
retain employees of superior ability. In addition, the Plan is intended to
further opportunities for stock ownership by such employees in order to increase
their proprietary interest in the Company, and, as a result, their interest in
the success of the Company. Awards will be made, in the discretion of the
Committee, to Key Employees (including officers and directors who are also
employees) whose responsibilities and decisions directly affect the performance
of any Participating Company and its subsidiaries. Such incentive awards may
consist of stock options, stock appreciation rights payable in stock or cash,
performance shares, restricted stock or any combination of the foregoing, as the
Committee may determine.

2. DEFINITIONS

When used herein, the following terms shall have the following meanings:

         "ACT" means the Securities Exchange Act of 1934.

         "ANNUAL LIMIT" means the maximum number of shares of Stock for which
Awards may be granted under the Plan in each Plan Year as provided in Section 3
of the Plan.

         "AWARD" means an award granted to any Key Employee in accordance with
the provisions of the Plan in the form of Options, Rights, Performance Shares or
Restricted Stock, or any combination of the foregoing.

         "AWARD AGREEMENT" means the written agreement evidencing each Award
granted to a Key Employee under the Plan.

         "BENEFICIAL OWNER" means any Person who, directly or indirectly, has
the right to vote or dispose of or has "beneficial ownership" (within the
meaning of Rule 13d-3 under the Act) of any securities of a company, including
any such right pursuant to any agreement, arrangement or understanding (whether
or not in writing), provided that: (i) a Person shall not be deemed the
Beneficial Owner of any security as a result of an agreement, arrangement or
understanding to vote such security (A) arising solely from a revocable proxy or
consent given in response to a public proxy or consent solicitation made
pursuant to, and in accordance with, the Act and the applicable rules and
regulations thereunder, or (B) made in connection with, or to otherwise
participate in, a proxy or consent solicitation made, or to be made, pursuant
to, and in accordance with, the applicable provisions of the Act and the
applicable rules and regulations thereunder, in 
<PAGE>   2
either case described in clause (A) or (B) above, whether or not such agreement,
arrangement or understanding is also then reportable by such Person on Schedule
13D under the Act (or any comparable or successor report); and (ii) a Person
engaged in business as an underwriter of securities shall not be deemed to be
the Beneficial Owner of any security acquired through such Person's
participation in good faith in a firm commitment underwriting until the
expiration of forty days after the date of such acquisition.

         "BENEFICIARY" means the beneficiary or beneficiaries designated
pursuant to Section 10 to receive the amount, if any, payable under the Plan
upon the death of a Key Employee.

         "BOARD" means the Board of Directors of the Company.

         "CHANGE OF CONTROL" means the occurrence of an event defined in Section
9 of the Plan.

         "CODE" means the Internal Revenue Code of 1986, as now in effect or as
hereafter amended. (All citations to sections of the Code are to such sections
as they may from time to time be amended or renumbered.)

         "COMMITTEE" means the Compensation and Personnel Committee of the Board
or such other committee as may be designated by the Board to administer the
Plan.

         "COMPANY" means Hartford Life, Inc. and its successors and assigns.

         "FAIR MARKET VALUE," unless otherwise indicated in the provisions of
this Plan, means, as of any date, the composite closing price for one share of
Stock on the New York Stock Exchange or, if no sales of Stock have taken place
on such date, the composite closing price on the most recent date on which
selling prices were quoted, the determination to be made in the discretion of
the Committee.

         "INCENTIVE STOCK OPTION" means a stock option qualified under Section
422 of the Code.

         "KEY EMPLOYEE" means an employee (including any officer or director who
is also an employee) of any Participating Company whose responsibilities and
decisions, in the judgment of the Committee, directly affect the performance of
the Company and its subsidiaries.

         "LIMITED STOCK APPRECIATION RIGHT" means a stock appreciation right
which shall become exercisable automatically upon the occurrence of a Change of
Control as described in Section 9 of the Plan.

         "OPTION" means an option awarded under Section 5 of the Plan to
purchase Stock of the Company, which option may be an Incentive Stock Option or
a non-qualified Stock option.

         "PARTICIPATING COMPANY" means the Company or any subsidiary or other
affiliate of the Company; provided, however, for Incentive Stock Options only,
"Participating Company" means 


                                       2
<PAGE>   3
the Company or any corporation which at the time such Option is granted
qualifies as a "subsidiary" of the Company under Section 424(f) of the Code.

         "PERFORMANCE SHARE" means a performance share awarded under Section 6
of the Plan.

         "PERSON" has the meaning ascribed to such term in Section 3(a)(9) of
the Act, as supplemented by Section 13(d)(3) of the Act; provided, however, that
Person shall not include (i) The Hartford, the Company, any subsidiary of the
Company or any other Person controlled by the Company, (ii) any trustee or other
fiduciary holding securities under any employee benefit plan of The Hartford,
the Company or of any subsidiary of the Company, or (iii) a corporation owned,
directly or indirectly, by the stockholders of the Company in substantially the
same proportions as their ownership of securities of the Company.

         "PLAN" means the 1997 Hartford Life, Inc. Incentive Stock Plan, as the
same may be amended, administered or interpreted from time to time.

         "PLAN YEAR" means the calendar year.

         "RETIREMENT" means eligibility to receive immediate retirement benefits
under a Participating Company pension plan.

         "RESTRICTED STOCK" means Stock awarded under Section 7 of the Plan
subject to such restrictions as the Committee deems appropriate or desirable.

         "RIGHT" means a stock appreciation right awarded in connection with an
Option under Section 5 of the Plan.

         "STOCK" means the Class A Common Stock ($.01 par value) of the Company.

         "THE HARTFORD" means The Hartford Financial Services Group, Inc. and
its successors and assigns.

         "TOTAL DISABILITY" means the complete and permanent inability of a Key
Employee to perform all of his or her duties under the terms of his or her
employment with any Participating Company, as determined by the Committee upon
the basis of such evidence, including independent medical reports and data, as
the Committee deems appropriate or necessary.

         "TRANSFEREE" means any person or entity to whom or to which a
non-qualified stock option has been transferred and assigned in accordance with
Section 5(h) of the Plan.

3.       SHARES SUBJECT TO THE PLAN


                                       3
<PAGE>   4
         The aggregate number of shares of Stock which may be awarded under the
Plan in any Plan Year shall be subject to an annual limit. The maximum number of
shares of Stock for which Awards may be granted under the Plan in each Plan Year
shall be 1.5 percent (1.5%) of the total of the issued and outstanding shares of
Class A Common Stock and Class B Common Stock and Class A treasury Stock and
Class B treasury Stock as reported in the Annual Report on Form 10-K of the
Company for the fiscal year ending immediately prior to any Plan Year, except
that for the Plan year that includes the initial public offering of Stock of the
Company, such maximum number shall be 1.5% of the issued and outstanding shares
of Class A Common Stock and Class B Common Stock of the Company immediately
following such offering (excluding shares issued by virtue of underwriters'
over-allotments). Any unused portion of the Annual Limit for any Plan Year shall
be carried forward and be made available for awards in succeeding Plan Years.

         In addition to the foregoing, in no event shall more than five million
(5,000,000) shares of Stock be cumulatively available for Awards of Incentive
Stock Options under the Plan, and provided further, that no more than twenty
percent (20%) of the total number of shares on a cumulative basis shall be
available for Restricted Stock and Performance Share Awards. For any Plan Year,
no individual employee may receive an Award of Options for more than the lesser
of (i) ten percent (10%) of the Annual Limit on available shares applicable to
that Plan Year or (ii) 500,000 shares; except that, for the Plan Year that
follows the initial public offering of Stock of the Company, each individual
employee may receive in addition to the foregoing limit that number of
substitute Options and Restricted Stock equitably determined by the Committee to
be required to replace stock options and restricted stock granted by The
Hartford and surrendered by such employee in connection with such offering.

         Subject to the above limitations, shares of Stock to be issued under
the Plan may be made available from the authorized but unissued shares, or
shares held by the Company in treasury or from shares purchased in the open
market.

         Notwithstanding anything herein to the contrary, and to the extent
permitted by applicable law, no award of shares of Stock shall be made under the
Plan, and the Company shall have no obligation to issue any shares of Stock
under the Plan, if such award would cause the direct or indirect percentage
ownership of The Hartford of the combined voting power or the value of the
capital stock of the Company to fall below 80%.


                                       4
<PAGE>   5
         For the purpose of computing the total number of shares of Stock
available for Awards under the Plan and in applying the limitation in the
preceding paragraph, there shall be counted against the foregoing limitations
the number of shares of Stock subject to issuance upon exercise or settlement of
Awards and the number of shares of Stock which equal the value of performance
share Awards, in each case determined as at the dates on which such Awards are
granted. If any Awards under the Plan are forfeited, terminated, expire
unexercised, are settled in cash in lieu of Stock or are exchanged for other
Awards, the shares of Stock which were theretofore subject to such Awards shall
again be available for Awards under the Plan to the extent of such forfeiture,
termination, cash settlement or exchange of such Awards. Further, any shares
that are exchanged (either actually or constructively) by optionees as full or
partial payment to the Company of the purchase price of shares being acquired
through the exercise of a Stock option granted under the Plan may be available
for subsequent Awards.

4.       GRANT OF AWARDS AND AWARD AGREEMENTS

         (a) Subject to the provisions of the Plan, the Committee shall (i)
determine and designate from time to time those Key Employees or groups of Key
Employees to whom Awards are to be granted; (ii) determine the form or forms of
Award to be granted to any Key Employee; (iii) determine the amount or number of
shares of Stock subject to each Award; and (iv) determine the terms and
conditions of each Award.

         (b) Each Award granted under the Plan shall be evidenced by a written
Award Agreement. Such agreement shall be subject to and incorporate the express
terms and conditions, if any, required under the Plan or required by the
Committee.

5.       STOCK OPTIONS AND RIGHTS

         (a) With respect to Options and Rights, the Committee shall (i)
authorize the granting of Incentive Stock Options, non-qualified Stock options,
or a combination of Incentive Stock Options and non-qualified Stock options;
(ii) authorize the granting of Rights which may be granted in connection with
all or part of any Option granted under this Plan, either concurrently with the
grant of the Option or at any time thereafter during the term of the Option;
(iii) determine the number of shares of Stock subject to each Option or the
number of shares of Stock that shall be used to determine the value of a Right;
and (iv) determine the time or times when and the manner in which each Option or
Right shall be exercisable and the duration of the exercise period.

         (b) Any option issued hereunder which is intended to qualify as an
Incentive Stock Option shall be subject to such limitations or requirements as
may be necessary for the purposes of Section 422 of the Code or any regulations
and rulings thereunder to the extent and in such form as determined by the
Committee in its discretion.

         (c) The exercise period for a non-qualified Stock option and any
related Right shall not exceed ten years and two days from the date of grant,
and the exercise period for an Incentive Stock Option and any related Right
shall not exceed ten years from the date of grant.


                                       5
<PAGE>   6
         (d) The Option price per share shall be determined by the Committee at
the time any Option is granted and shall be not less than the Fair Market Value
of one share of Stock on the date the Option is granted.

         (e) No part of any Option or Right may be exercised until the Key
Employee who has been granted the Award shall have remained in the employ of a
Participating Company for such period after the date of grant as the Committee
may specify, if any, and the Committee may further require exercisability in
installments.

         (f) The purchase price of the shares as to which an Option shall be
exercised shall be paid to the Company at the time of exercise either in cash or
Stock already owned by the optionee having a total Fair Market Value equal to
the purchase price, or a combination of cash and Stock having a total fair
market value, as so determined, equal to the purchase price. The Committee shall
determine acceptable methods for tendering Stock as payment upon exercise of an
Option and may impose such limitations and prohibitions on the use of Stock to
exercise an Option as it deems appropriate.

         (g) In case of termination of employment, the following provisions
shall apply:

                  (A)  If a Key Employee who has been granted an Option
shall die before such Option has expired, his or her Option may be exercised in
full by (i) the person or persons to whom the Key Employee's rights under the
Option pass by will, or if no such person has such right, by his or her
executors or administrators; (ii) his or her Transferee(s) (with respect to
non-qualified stock options); or (iii) his or her Beneficiary designated
pursuant to Section 10, at any time, or from time to time, within five years
after the date of the Key Employee's death or within such other period, and
subject to such terms and conditions as the Committee may specify, but not later
than the expiration date specified in Section 5(c) above.

                  (B)  If the Key Employee's employment by any Participating
Company terminates because of his or her Retirement or Total Disability, he or
she may exercise his or her Options in full at any time, or from time to time,
within five years after the date of the termination of his or her employment or
within such other period, and subject to such terms and conditions as the
Committee may specify, but not later than the expiration date specified in
Section 5(c) above. Any such Options not fully exercisable immediately prior to
such optionee's retirement shall become fully exercisable upon such retirement
unless the Committee, in its sole discretion, shall otherwise determine.

                  (C)  Except as provided in Section 9, if the Key Employee
shall voluntarily resign before eligibility for Retirement or he or she is
terminated for cause as determined by the Committee, the Options or Rights shall
be canceled coincident with the effective date of the termination of employment.

                  (D)  If the Key Employee's employment terminates for any
other reason, he or she may exercise his or her Options, to the extent that he
or she shall have been entitled to do so 


                                       6
<PAGE>   7
at the date of the termination of his or her employment, at any time, or from
time to time, within three months after the date of the termination of his or
her employment or within such other period, and subject to such terms and
conditions as the Committee may specify, but not later than the expiration date
specified in Section 5(c) above.

         (h) Except as provided in this Section 5(h), no Option or Right granted
under the Plan shall be transferable other than by will or by the laws of
descent and distribution. During the lifetime of the optionee, an Option or
Right shall be exercisable only by the Key Employee to whom the Option or Right
is granted (or his or her estate or designated Beneficiary). Notwithstanding the
foregoing, all or a portion of a non-qualified stock option may be transferred
and assigned by such persons designated by the Committee, to such persons
designated by the Committee and upon such terms and conditions as the Committee
may from time to time authorize and determine in its sole discretion.

         (i) With respect to an Incentive Stock Option, the Committee shall
specify such terms and provisions as the Committee may determine to be necessary
or desirable in order to qualify such Option as an "incentive stock option"
within the meaning of Section 422 of the Code.

         (j) With respect to the exercisability and settlement of Rights:

                           (i) Upon exercise of a Right, the Key Employee shall
                  be entitled, subject to such terms and conditions the
                  Committee may specify, to receive upon exercise thereof all or
                  a portion of the excess of (A) the Fair Market Value of a
                  specified number of shares of Stock at the time of exercise,
                  as determined by the Committee, over (B) a specified amount
                  which shall not, subject to Section 5(d), be less than the
                  Fair Market Value of such specified number of shares of Stock
                  at the time the Right is granted. Upon exercise of a Right,
                  payment of such excess shall be made as the Committee shall
                  specify in cash, the issuance or transfer to the Key Employee
                  of whole shares of Stock with a Fair Market Value at such time
                  equal to any excess, or a combination of cash and shares of
                  Stock with a combined Fair Market Value at such time equal to
                  any such excess, all as determined by the Committee. The
                  Company will not issue a fractional share of Stock and, if a
                  fractional share would otherwise be issuable, the Company
                  shall pay cash equal to the Fair Market Value of the
                  fractional share of Stock at such time.

                           (ii) In the event of the exercise of such Right, the
                  Company's obligation in respect of any related Option or such
                  portion thereof will be discharged by payment of the Right so
                  exercised.

6.       PERFORMANCE SHARES

         (a) Subject to the provisions of the Plan, the Committee shall (i)
determine and designate from time to time those Key Employees or groups of Key
Employees to whom Awards of Performance Shares are to be made, (ii) determine
the Performance Period (the "Performance 


                                       7
<PAGE>   8
Period") and Performance Objectives (the "Performance Objectives") applicable to
such Awards, (iii) determine the form of settlement of a Performance Share and
(iv) generally determine the terms and conditions of each such Award. At any
date, each Performance Share shall have a value equal to the Fair Market Value
of one share of Stock at such date; provided that the Committee may limit the
aggregate amount payable upon the settlement of any Award. The maximum award for
any individual employee in any given year shall be 100,000 Performance Shares.

         (b) The Committee shall determine a Performance Period of not less than
two nor more than five years. Performance Periods may overlap and Key Employees
may participate simultaneously with respect to Performance Shares for which
different Performance Periods are prescribed.

         (c) The Committee shall determine the Performance Objectives for Awards
of Performance Shares. Performance Objectives may vary from Key Employee to Key
Employee and between groups of Key Employees and shall be based upon one or more
of the following objective criteria, as the Committee deems appropriate, which
may be (i) determined solely by reference to the performance of the Company, any
subsidiary or affiliate of the Company or any division or unit of any of the
foregoing, or (ii) based on comparative performance of any one or more of the
following relative to other entities: (A) earnings per share, (B) return on
equity, (C) cash flow, (D) return on total capital, (E) return on assets, (F)
economic value added, (G) increase in surplus, (H) reductions in operating
expenses, (I) increases in operating margins (J) earnings before income taxes
and depreciation, (K) total shareholder return (L) return on invested capital,
(M) cost reductions and savings, (N) earnings before interest, taxes,
depreciation and amortization ("EBITDA"), (O) pre-tax operating income (P)
productivity improvements, or (Q) a Key Employee's attainment of personal
objectives with respect to any of the foregoing criteria or other criteria such
as growth and profitability, customer satisfaction, leadership effectiveness,
business development, negotiating transactions and sales or developing long term
business goals. If during the course of a Performance Period there shall occur
significant events which the Committee expects to have a substantial effect on
the applicable Performance Objectives during such period, the Committee may
revise such Performance Objectives.

         (d) At the beginning of a Performance Period, the Committee shall
determine for each Key Employee or group of Key Employees the number of
Performance Shares or the percentage of Performance Shares which shall be paid
to the Key Employee or member of the group of Key Employees if the applicable
Performance Objectives are met in whole or in part.

         (e) If a Key Employee terminates service with all Participating
Companies during a Performance Period because of death, Total Disability,
Retirement, or under other circumstances where the Committee in its sole
discretion finds that a waiver would be in the best interests of the Company,
that Key Employee may, as determined by the Committee, be entitled to payment in
settlement of such Performance Shares at the end of the Performance Period based
upon the extent to which the Performance Objectives were satisfied at the end of
such period and prorated for the portion of the Performance Period during which
the Key Employee was employed by any 


                                       8
<PAGE>   9
Participating Company; provided, however, the Committee may provide for an
earlier payment in settlement of such Performance Shares in such amount and
under such terms and conditions as the Committee deems appropriate or desirable.
If a Key Employee terminates service with all Participating Companies during a
Performance Period for any other reason, then such Key Employee shall not be
entitled to any Award with respect to that Performance Period unless the
Committee shall otherwise determine.

         (f) Each Award of a Performance Share shall be paid in whole shares of
Stock, or cash, or a combination of Stock and cash either as a lump sum payment
or in annual installments, all as the Committee shall determine, with payment to
commence as soon as practicable after the end of the relevant Performance
Period.

7.       RESTRICTED STOCK

         (a) Restricted Stock shall be subject to a restriction period (after
which restrictions will lapse) which shall mean a period commencing on the date
the Award is granted and ending on such date as the Committee shall determine
(the "Restriction Period"). The Committee may provide for the lapse of
restrictions in installments where deemed appropriate and it may also require
the achievement of predetermined performance objectives in order for such shares
to vest.

         (b) Except when the Committee determines otherwise pursuant to Section
7(d), if a Key Employee terminates employment with all Participating Companies
for any reason before the expiration of the Restriction Period, all shares of
Restricted Stock still subject to restriction shall be forfeited by the Key
Employee and shall be reacquired by the Company.

         (c) Except as otherwise provided in this Section 7, no shares of
Restricted Stock received by a Key Employee shall be sold, exchanged,
transferred, pledged, hypothecated or otherwise disposed of during the
Restriction Period.

         (d) In cases of death, Total Disability or Retirement or in cases of
special circumstances, the Committee may, in its sole discretion when it finds
that a waiver would be in the best interests of the Company, elect to waive any
or all remaining restrictions with respect to such Key Employee's Restricted
Stock.

         (e) The Committee may require, under such terms and conditions as it
deems appropriate or desirable, that the certificates for Stock delivered under
the Plan may be held in custody by a bank or other institution, or that the
Company may itself hold such shares in custody until the Restriction Period
expires or until restrictions thereon otherwise lapse, and may require, as a
condition of any Award of Restricted Stock that the Key Employee shall have
delivered a stock power endorsed in blank relating to the Restricted Stock.

         (f) Nothing in this Section 7 shall preclude a Key Employee from
exchanging any shares of Restricted Stock subject to the restrictions contained
herein for any other shares of Stock that are similarly restricted.


                                       9
<PAGE>   10
         (g) Subject to Section 7(e) and Section 8, each Key Employee entitled
to receive Restricted Stock under the Plan shall be issued a certificate for the
shares of Stock. Such certificate shall be registered in the name of the Key
Employee, and shall bear an appropriate legend reciting the terms, conditions
and restrictions, if any, applicable to such Award and shall be subject to
appropriate stop-transfer orders.

8.       CERTIFICATES FOR AWARDS OF STOCK

         (a) The Company shall not be required to issue or deliver any
certificates for shares of Stock prior to (i) the listing of such shares on any
stock exchange on which the Stock may then be listed and (ii) the completion of
any registration or qualification of such shares under any federal or state law,
or any ruling or regulation of any government body which the Company shall, in
its sole discretion, determine to be necessary or advisable.

         (b) All certificates for shares of Stock delivered under the Plan shall
also be subject to such stop-transfer orders and other restrictions as the
Committee may deem advisable under the rules, regulations, and other
requirements of the Securities and Exchange Commission, any stock exchange upon
which the Stock is then listed and any applicable federal or state securities
laws, and the Committee may cause a legend or legends to be placed on any such
certificates to make appropriate reference to such restrictions. In making such
determination, the Committee may rely upon an opinion of counsel for the
Company.

         (c) Except for the restrictions on Restricted Stock under Section 7,
each Key Employee who receives Stock in settlement of an Award of Stock, shall
have all of the rights of a shareholder with respect to such shares, including
the right to vote the shares and receive dividends and other distributions. No
Key Employee awarded an Option, a Right or Performance Share shall have any
right as a shareholder with respect to any shares covered by his or her Option,
Right or Performance Share prior to the date of issuance to him or her of a
certificate or certificates for such shares.

9.       CHANGE OF CONTROL

         (a)      For purposes of this Plan, a Change of Control shall occur if:

                  (i)      a report on Schedule 13D shall be filed with the
                           Securities and Exchange Commission pursuant to
                           Section 13(d) of the Act disclosing that any Person,
                           other than the Company or The Hartford or a
                           subsidiary of either of the foregoing or any employee
                           benefit plan sponsored by the Company or The Hartford
                           or a subsidiary of either of the foregoing, is the
                           Beneficial Owner of the greater of (A) the percentage
                           of the outstanding stock of the Company entitled to
                           vote in the election of directors of the Company
                           owned at such time by The Hartford, or (B) twenty
                           percent or more of the outstanding stock of the
                           Company entitled to vote in the election of directors
                           of the Company;


                                       10
<PAGE>   11
                  (ii)     any Person, other than the Company or The Hartford or
                           a subsidiary of either of the foregoing or any
                           employee benefit plan sponsored by the Company or The
                           Hartford or a subsidiary of either of the foregoing,
                           shall purchase shares pursuant to a tender offer or
                           exchange offer to acquire any stock of the Company
                           (or securities convertible into stock) for cash,
                           securities or any other consideration, provided that
                           after consummation of the offer, the Person in
                           question is the Beneficial Owner, directly or
                           indirectly, of the greater of (A) the percentage of
                           the outstanding stock of the Company entitled to vote
                           in the election of directors of the Company owned at
                           such time by The Hartford, or (B) fifteen percent or
                           more of the outstanding stock of the Company entitled
                           to vote in the election of directors of the Company
                           (calculated as provided in paragraph (d) of Rule
                           13d-3 under the Act in the case of rights to acquire
                           stock);

                  (iii)    the stockholders of the Company shall approve (A) any
                           consolidation or merger of the Company in which the
                           Company is not the continuing or surviving
                           corporation or pursuant to which shares of stock of
                           the Company entitled to vote in the election of
                           directors of the Company would be converted into
                           cash, securities or other property, other than a
                           merger of the Company in which holders of such stock
                           of the Company immediately prior to the merger have
                           the same proportionate ownership of common stock
                           entitled to vote in the election of directors of the
                           surviving corporation immediately after the merger as
                           immediately before, or (B) any sale, lease, exchange
                           or other transfer (in one transaction or a series of
                           related transactions) of all or substantially all the
                           assets of the Company; or

                  (iv)     within any 12 month period, the persons who were
                           directors of the Company immediately before the
                           beginning of such period (the "Incumbent Directors")
                           shall cease (for any reason other than death) to
                           constitute at least a majority of the Board of the
                           Company or the board of directors of any successor to
                           the Company, provided that any director who was not a
                           director at the beginning of such period shall be
                           deemed to be an Incumbent Director if such director
                           (A) was elected to the Board of the Company by, or on
                           the recommendation of or with the approval of, at
                           least two-thirds of the directors who then qualified
                           as Incumbent Directors either actually or by prior
                           operation of this clause (iv), and (B) was not
                           designated by a Person who has entered into an
                           agreement with the Company to effect a transaction
                           described in the immediately preceding clause (iii);
                           or

                  (v)      a Change of Control as defined in The Hartford 1995
                           Incentive Stock Plan, as amended from time to time,
                           occurs with respect to The Hartford at a time when
                           The Hartford directly or indirectly owns more than
                           50% of the combined voting power and the value of the
                           capital stock of the Company;


                                       11
<PAGE>   12
provided that a sale of all of the interest of The Hartford in the Company shall
not be considered a Change of Control for purposes of this Plan.

         (b) Notwithstanding any provisions in this Plan to the contrary:

                  (i)  Each outstanding Option granted under the Plan shall
become immediately exercisable in full for the aggregate number of shares
covered thereby and all related Rights shall also become exercisable upon the
occurrence of a Change of Control described in this Section 9 and shall continue
to be exercisable in full for cash for a period of 60 calendar days beginning on
the date that such Change of Control occurs and ending on the 60th calendar day
following that date; provided, however, that no Option or Right shall be
exercisable beyond the expiration date of its original term.

                  (ii)  Options and Rights shall not terminate and shall
continue to be fully exercisable for a period of seven months following the
occurrence of a Change of Control in the case of an employee who is terminated
other than for just cause or who voluntarily terminates his employment because
he or she in good faith believes that as a result of such Change of Control he
is unable effectively to discharge his present duties or the duties of the
position he occupied just prior to the occurrence of such Change of Control. For
purposes of Section 9 only, termination shall be for "just cause" only if such
termination is based on fraud, misappropriation or embezzlement on the part of
the employee which results in a final conviction of a felony. Under no
circumstances, however, shall any Option or Right be exercised beyond the
expiration date of its original term.

                  (iii)  Any Right or portion thereof may be exercised for
cash within the 60 calendar day period following the occurrence of a Change of
Control with settlement, except in the case of a Right related to an Incentive
Stock Option, based on the "Formula Price" which shall be the highest of (A) the
highest composite daily closing price of the Stock during the period beginning
on the 60th calendar day prior to the Change of Control and ending on the date
of such Change of Control, (B) the highest gross price paid for the Stock during
the same period of time, as reported in a report on Schedule 13D filed with the
Securities and Exchange Commission or (C) the highest gross price paid or to be
paid for a share of Stock (whether by way of exchange, conversion, distribution
upon merger, liquidation or otherwise) in any of the transactions set forth in
this Section 9 as constituting a Change of Control.

                  (iv)  Upon the occurrence of a Change of Control, Limited
Stock Appreciation Rights shall automatically be granted as to any Option with
respect to which Rights are not then outstanding; provided, however, that
Limited Stock Appreciation Rights shall be provided at the time of grant of any
Incentive Stock Option subject to exercisability upon the occurrence of a Change
of Control. Limited Stock Appreciation Rights shall entitle the holder thereof,
upon exercise of such rights and surrender of the related Option or any portion
thereof, to receive, without payment to the Company (except for applicable
withholding taxes), an amount in cash equal to the excess, if any, of the
Formula Price as that term is defined in Section 9 over the option price of the
Stock as provided in such Option; provided that in the case of the exercise of
any such Limited Stock Appreciation Right or portion thereof related to an
Incentive Stock Option, the Fair Market Value of the Stock at the time of such
exercise shall be substituted for the Formula Price. Each such Limited Stock
Appreciation Right shall be exercisable only during the period beginning on the
first 


                                       12
<PAGE>   13
business day following the occurrence of such Change of Control and ending on
the 60th day following such date and only to the same extent the related Option
is exercisable. Upon exercise of a Limited Stock Appreciation Right and
surrender of the related Option, or portion thereof, such Option, to the extent
surrendered, shall not thereafter be exercisable.

                  (v)  The restrictions applicable to shares of Restricted
Stock held by Key Employees pursuant to Section 7 shall lapse upon the
occurrence of a Change of Control, and such Key Employees shall be entitled to
elect, at any time during the 60 calendar days following the Change of Control,
to receive immediately after the date the Key Employee makes such election
either of the following: (A) unrestricted certificates for all of such shares,
or (B) a lump sum cash amount equal to the number of such shares multiplied by
the Formula Price. If a Key Employee does not make any election during the
foregoing 60 day period, such Key Employee shall be deemed to have made the
election described in Section 9(b)(v)(A) as of the 60th day of such period, and
unrestricted certificates shall be issued to such Key Employee immediately
following such day as described in Section 9(b)(v)(A) hereof.

                  (vi)  If a Change of Control occurs during the course of a
Performance Period applicable to an Award of Performance Shares pursuant to
Section 6, then a Key Employee shall be deemed to have satisfied the Performance
Objectives effective on the date of such occurrence. Such Key Employee shall be
paid, immediately following the occurrence of such Change of Control, a lump sum
cash amount equal to the number of outstanding Performance Shares awarded to
such Key Employee multiplied by the Formula Price.

         (c) In the event of a Change of Control, no amendment, suspension or
termination of the Plan thereafter shall impair or reduce the rights of any
person with respect to any Award made under the Plan.

10.      BENEFICIARY

         (a) Each Key Employee and/or his or her Transferee may file with the
Company a written designation of one or more persons as the Beneficiary who
shall be entitled to receive the Award, if any, payable under the Plan upon his
or her death. A Key Employee or Transferee may from time to time revoke or
change his or her Beneficiary designation without the consent of any prior
Beneficiary by filing a new designation with the Company. The last such
designation received by the Company shall be controlling; provided, however,
that no designation, or change or revocation thereof, shall be effective unless
received by the Company prior to the Key Employee's or Transferee's death, as
the case may be, and in no event shall it be effective as of a date prior to
such receipt.

         (b) If no such Beneficiary designation is in effect at the time of a
Key Employee's or Transferee's death, as the case may be, or if no designated
Beneficiary survives the Key Employee or Transferee, or if such designation
conflicts with law, the Key Employee's or Transferee's estate, as the case may
be, shall be entitled to receive the Award, if any, payable under the Plan upon
his or her death. If the Committee is in doubt as to the right of any person to
receive such Award, the Company may retain such Award, without liability for any
interest thereon, until the Committee determines the rights thereto, or the
Company may pay such Award into any court of appropriate 


                                       13
<PAGE>   14
jurisdiction and such payment shall be a complete discharge of the liability of
the Company therefor.

11.      ADMINISTRATION OF THE PLAN

         (a) Each member of the Committee shall be a member of the Board and
both a "non-employee director" within the meaning of Rule 16b-3 under the Act or
successor rule or regulation and an "outside director" for purposes of Section
162(m) of the Internal Revenue Code.

         (b) All decisions, determinations or actions of the Committee made or
taken pursuant to grants of authority under the Plan shall be made or taken in
the sole discretion of the Committee and shall be final, conclusive and binding
on all persons for all purposes.

         (c) The Committee shall have full power, discretion and authority to
interpret, construe and administer the Plan and any part thereof, and its
interpretations and constructions thereof and actions taken thereunder shall be,
except as otherwise determined by the Board, final, conclusive and binding on
all persons for all purposes.

         (d) The Committee's decisions and determinations under the Plan need
not be uniform and may be made selectively among Key Employees, whether or not
such Key Employees are similarly situated.

         (e) The Committee may, in its sole discretion, delegate such of its
powers as it deems appropriate to the chief executive officer or other members
of senior management, except that Awards to executive officers shall be made
solely by the Committee and subject to compliance with Rule 16b-3 of the Act.

         (f) If a Change of Control has not occurred and if the Committee
determines that a Key Employee has taken action inimical to the best interests
of any Participating Company, the Committee may, in its sole discretion,
terminate in whole or in part such portion of any Option (including any related
Right) as has not yet become exercisable at the time of termination, terminate
any Performance Share Award for which the Performance Period has not been
completed or terminate any Award of Restricted Stock for which the Restriction
Period has not lapsed.

12.      AMENDMENT, EXTENSION OR TERMINATION

         The Board may, at any time, amend or terminate the Plan and,
specifically, may make such modifications to the Plan as it deems necessary to
avoid the application of Section 162(m) of the Code and the Treasury regulations
issued thereunder. However, no amendment applicable to Incentive Stock Options
shall, without approval by a majority of the Company's stockholders, (a) alter
the group of persons eligible to participate in the Plan, or (b) except as
provided in Section 13 increase the maximum number of shares of Stock which are
available for Awards under the Plan. If a Change of Control has occurred, no
amendment or termination shall impair the rights of any person with respect to a
prior Award.

13.      ADJUSTMENTS IN EVENT OF CHANGE IN COMMON STOCK

         In the event of any reorganization, merger, recapitalization,
consolidation, liquidation, Stock 


                                       14
<PAGE>   15
dividend, Stock split, reclassification, combination of shares, rights offering,
split-up or extraordinary dividend (including a spin-off) or divestiture, or any
other change in the corporate structure or shares of Stock, the Committee may
make such adjustment in the Stock subject to Awards, including Stock subject to
purchase by an Option, or the terms, conditions or restrictions on Stock or
Awards, including the price payable upon the exercise of such Option and the
number of shares subject to restricted Stock awards, as the Committee deems
equitable.

14.      SUBSTITUTE AWARDS

         The Committee shall be authorized to issue substitute Options and
related Rights to those Key Employees of Participating Companies who surrender
options to acquire stock in The Hartford. The Committee may make a determination
as to the exercise price and number of such substitute options as it may
determine in order equitably to preserve the economic value of the surrendered
options and related rights of The Hartford in the aggregate amount not to exceed
8,000,000 shares. Subject to this limitation, shares of Stock to be issued upon
the exercise of substitute Options may be made available from authorized but
unissued shares or from treasury or shares held by the Company or shares
purchased in the open market.

         The maximum number of substitute Options and related Rights that may be
granted to an individual employee is such number as may be determined by the
Committee to be necessary to preserve the economic value of the surrendered
options and related rights of The Hartford by any such individual employee.

         The terms and conditions of each substitute Stock award, including,
without limitation, the expiration date of the option, the time or times when,
and the manner in which, each substitute option shall be exercisable, the
duration of the exercise period, the method of exercise, settlement and payment,
and the rules in the event of termination, shall be the same as those of the
surrendered award granted by The Hartford.

         The Committee shall also be authorized to issue substitute grants of
Restricted Stock to replace shares of restricted stock of The Hartford
surrendered by employees of Participating Companies. Such substitute shares
shall be subject to the same terms and conditions as the surrendered shares of
The Hartford restricted stock, including, without limitation, the restriction
period of such restricted shares of The Hartford.

15.      MISCELLANEOUS

         (a) Except as provided in Section 9, nothing in this Plan or any Award
granted hereunder shall confer upon any employee any right to continue in the
employ of any Participating Company or interfere in any way with the right of
any Participating Company to terminate his or her employment at any time. No
Award payable under the Plan shall be deemed salary or compensation for the
purpose of computing benefits under any employee benefit plan or other
arrangement of any Participating Company for the benefit of its employees unless
the Company shall determine otherwise. No Key Employee shall have any claim to
an Award until it is actually granted under the Plan. To the extent that any
person acquires a right to receive payments from the Company under this Plan,
such right shall be no greater than the right of an 


                                       15
<PAGE>   16
unsecured general creditor of the Company. All payments to be made hereunder
shall be paid from the general funds of the Company and no special or separate
fund shall be established and no segregation of assets shall be made to assure
payment of such amounts except as provided in Section 7(e) with respect to
Restricted Stock.

         (b) The Committee may cause to be made, as a condition precedent to the
payment of any Award, or otherwise, appropriate arrangements with the Key
Employee or his or her Beneficiary, for the withholding of any federal, state,
local or foreign taxes.

         (c) The Plan and the grant of Awards shall be subject to all applicable
federal and state laws, rules, and regulations and to such approvals by any
government or regulatory agency as may be required.

         (d) The terms of the Plan shall be binding upon the Company and its
successors and assigns.

         (e) Captions preceding the sections hereof are inserted solely as a
matter of convenience and in no way define or limit the scope or intent of any
provision hereof.

16.      EFFECTIVE DATE, TERM OF PLAN AND SHAREHOLDER APPROVAL

         The effective date of the Plan shall be May 22, 1997. No Award shall be
granted under this Plan after the Plan's termination date. The Plan's
termination date shall be December 31, 2007. The Plan will continue in effect
for existing Awards as long as any such Award is outstanding.