<PAGE>

                                 STATE OF OHIO
                            DEPARTMENT OF INSURANCE


IN THE MATTER OF:                       :CONFIDENTIAL AMENDED SUPERVISION
                                        :ORDER PURSUANT TO OHIO
INTEGRITY LIFE INSURANCE COMPANY        :REVISED CODE SECTION 3903.11

          Pursuant to Ohio Revised Code ("O.R.C.") Section 3903.09(B), the
Superintendent made the determination to supervise Integrity Life Insurance
Company (the "Company"), an Ohio life insurance legal reserve corporation, and
placed the Company under supervision by an Order issued August 20, 1999
("Supervision Order"). The Superintendent has determined to amend the
Supervision Order ("Amended Supervision Order"): the Amended Supervision Order
shall supercede the Supervision Order.

     1.    By copy of this Amended Supervision Order, (the "Company") is hereby
           notified that it remains under supervision.

     2.    The Superintendent's requirement to abate the determination and
           thereby be released from Supervision is that the Company shall attain
           sufficient liquidity, surplus, and reserves necessary to exceed and
           maintain company Action Level RBC, as defined in O.R.C. Section
           3903.81.

     3.    During the period of this Supervision, Michael F. Motil, Assistant
           Chief Examiner, Office of Financial Regulation, remains Supervisor of
           the Company. The Supervisor is directed to enforce additional orders
           issued under O.R.C. Section 3903.09(A) or (B). During the period of
           supervision, the Company is hereby ordered and shall not, without the
           prior written consent of the Superintendent or the Supervisor:

           a)   Dispose of, convey or encumber any of its assets;

           b)    withdraw from any accounts, except for death benefits,
                 previously scheduled systematic withdrawals, previously
                 scheduled immediate annuity payments, variable annuities and
                 variable life payments that are maintained separately
                 pursuant to O.R.C Section 3907.15 and agent commission
                 payments;

           c)    lend any of its funds;

           d)    invest any of its funds except in investments expressly
                 permitted by O.R.C. Section 3907.14;

           e)    transfer any of its property;

           f)    incur any debt, obligation, or liability;

           g)    merge or consolidate with any other person;

           h)    enter into any new, modify, amend or cancel any existing
                 reinsurance contract or treaty; or

           i)    implement any action ratified at any meeting of the board of
                 directors, executive committee, or any other committee of the
                 Company.

     4.    The Superintendent may retain, at the Company's expense, such experts
           (including, but not limited to, attorneys, actuaries, accountants and
           investment advisors) not


<PAGE>

           otherwise a part of the Superintendent's staff, as the Superintendent
           reasonably believes is necessary to assist in the supervision of the
           Company.

     5.    The Company shall immediately report any material changes to its
           operations to the Department of Insurance.

     6.    The Company's board of directors shall provide a certified resolution
           within ten (10) business-days to the Department stating that it has
           received a copy of this Supervision Order.

     7.    This Amended Supervision Order shall remain in effect for 60 days.
           Unless the Superintendent begins proceedings under O.R.C. Section
           3903.12 or 3903.17 for the appointment of a rehabilitator or
           liquidator, this Amended Supervision Order shall be extended for
           successive 60-day periods automatically until written notice from the
           Superintendent is given to the Company ending this Supervision.

     8.    The Company may, within 30 days of the date of service of this
           Amended Supervision Order, request a hearing to review this
           Order. If requested, such hearing will be held in Franklin
           County, Ohio, and will be held privately unless the Company
           requests a public hearing. At any such hearing, the Company may
           appear via its officers or through counsel or other person
           authorized to practice before the Department of Insurance, and
           may present evidence and examine witnesses appearing before and
           against it.

           A copy of this Amended Supervision Order shall be served upon John R.
     Lindholm, President, Integrity Life Insurance Company, 515 West Market
     Street, Louisville, Kentucky 40202.



Date: August 31, 1999                  /s/ J. Lee Covington II
     -----------------------           ----------------------------
                                       J. Lee Covington II by [Illegible]
                                                            Deputy Director

                             CERTIFICATE OF SERVICE

The undersigned hereby certifies that a true copy of the foregoing Confidential
Amended Supervision Order was sent this 31st day of August, 1999, by certified
mail, return receipt requested, to John R. Lindholm, President, Integrity Life
Insurance Company, 515 West Market Street, Louisville, Kentucky 40202, and by
facsimile 502/582-7903 to Kevin Howard, Senior Vice President, ARM Financial
Group.


Certified Mail No. Z 395 347 548          Beverly A. Abbott
                   -------------          -----------------