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                                                                    EXHIBIT 10.1


                     CHANGE IN CONTROL EMPLOYMENT AGREEMENT


      AGREEMENT by and between Healthaxis, Ltd., a Texas limited partnership
(the "Company") and an indirect wholly owned subsidiary of HealthAxis Inc., a
Pennsylvania corporation (the "Parent"), and John D. Smith (the "Executive"),
dated as of the 1st day of April, 2002.

      The Board of Managers of Healthaxis Managing Partner, LLC, the general
partner of the Company (the "Managers"), has determined that it is in the best
interests of the Company and its partners to assure that the Company will have
the continued dedication of the Executive, notwithstanding the possibility,
threat or occurrence of a Change in Control (as defined below). The Managers
believe it is imperative to diminish the inevitable distraction of the Executive
by virtue of the personal uncertainties and risks created by a pending or
threatened Change in Control and to encourage the Executive's full attention and
dedication to the Company currently and in the event of any threatened or
pending Change in Control, and to provide the Executive with compensation and
benefits arrangements upon a Change in Control which ensure that the
compensation and benefits expectations of the Executive will be satisfied and
which are competitive with those of other corporations. Therefore, in order to
accomplish these objectives, the Managers, at the direction and with the
approval of the Board of Directors of the Parent, have caused the Company to
enter into this Agreement.

      NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

      1. Certain Definitions.

            (a)   The "Effective Date" shall mean the first date during the
                  Change in Control Period (as defined in Section 1(b)) on which
                  a Change in Control (as defined in Section 1(d)) occurs.
                  Anything in this Agreement to the contrary notwithstanding,
                  the "Effective Date" shall mean the date immediately prior to
                  the date of the Executive's termination of employment, if such
                  termination occurs either (i) within six (6) months prior to a
                  Change in Control; or (ii) prior to a Change in Control and
                  reasonably demonstrated by the Executive to be at the request
                  of a third party who has taken steps reasonably calculated to
                  effect a Change in Control or otherwise arising in connection
                  with or anticipation of a Change in Control.

            (b)   The "Change in Control Period" shall mean the period
                  commencing on the date hereof and ending on January 1, 2005,
                  provided, however, that commencing on January 1, 2003, and on
                  January 1 of each year thereafter (each such date shall be
                  hereinafter referred to as the "Renewal Date"), unless
                  previously terminated, the Change in Control Period shall



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                  be automatically extended so as to terminate three years from
                  such Renewal Date, unless at least 60 days prior to the
                  Renewal Date the Company shall give notice to the Executive
                  that the Change in Control Period shall not be so extended.

            (c)   "Subsidiary" shall mean any corporation or other entity
                  taxable as a corporation under Section 7701(a)(3) of the
                  Internal Revenue Code of 1986, as amended (the "Code") that is
                  a member of the "affiliated group" as defined in Section
                  1504(a) of the Code of which the Parent is a common parent
                  corporation; provided, however, that in each case the
                  subsidiary corporation or other entity must be consolidated in
                  the Parent's financial statements.

            (d)   "Change in Control" shall mean (i) a merger or consolidation
                  of the Parent or the Company with or into another corporation
                  in which the Parent or the Company shall not be the surviving
                  corporation (for purposes of this clause (i), a merger or
                  consolidation in which the Parent or the Company becomes a
                  subsidiary of another entity shall not be deemed a transaction
                  in which the Parent or the Company is the surviving
                  corporation); (ii) a dissolution of the Parent or the Company,
                  provided, however, that a dissolution of the Company which is
                  a direct result of the Company's default on the outstanding
                  two percent (2%) convertible debt held by Brown Simpson
                  Partners I, Ltd. and other investors shall not be treated as
                  triggering a Change in Control under this Section 1(d); (iii)
                  a transfer of all or substantially all of the assets of the
                  Parent or the Company in one transaction or a series of
                  related transactions to one or more other persons or entities;
                  (iv) any "person" or "group" (as those terms are used in
                  Sections 13(d) and 14(d) of the Securities Exchange Act of
                  1934, as amended from time to time (the "1934 Act"), other
                  than Excluded Persons (as defined below), becomes the
                  "beneficial owner" (as defined in Rule 13d-3 of the 1934 Act),
                  directly or indirectly, of securities of the Parent or the
                  Company representing 50% or more of the combined voting power
                  of the Parent's or the Company's then outstanding securities;
                  (v) after January 1, 2002, UICI and/or any affiliate of UICI
                  acquires, directly or indirectly, the power to vote over 50%
                  of the voting securities of the Parent or the Company,
                  provided, however, that any shares UICI acquires as a direct
                  result of a forfeiture of the options to acquire shares of the
                  Company's common stock held in the Founders Plan Voting Trust
                  shall not be included in any determination as to whether UICI
                  has acquired the power to vote over 50% of the voting
                  securities of the Parent or the Company; (vi) after January 1,
                  2002, individuals who at the beginning of the period
                  constituted the Board of Directors of the Parent (the "Board")
                  (together with any new directors whose election by such Board
                  or whose nomination for election by the stockholders of the
                  Parent was approved by a majority of the directors then still
                  in office who were either directors at the beginning of such
                  period or whose election or nomination for election was
                  previously so approved) cease for any reason to constitute at
                  least a majority of the Board of Directors then in office; or
                  (vii) a significant reorganization of the Parent or the
                  Company occurs, such as a spin-off, sale of assets of a
                  business or other restructuring, and as a result, the duties
                  and



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                  responsibilities of the Executive are materially reduced. The
                  term "Excluded Persons" means UICI, any affiliate of UICI, and
                  a trustee or other fiduciary holding securities under an
                  employee benefit plan of the Parent or the Company.

                  For purposes hereof, a person will be deemed to be the
                  beneficial owner of any voting securities of the Parent which
                  it would be considered to beneficially own under Securities
                  and Exchange Commission Rule 13d-3 (or any similar or
                  superseding statute or rule from time to time in effect).

      2. Employment Period. The Company hereby agrees to continue the Executive
in its employ, and the Executive hereby agrees to remain in the employ of the
Company subject to the terms and conditions of this Agreement, for the period
commencing on the Effective Date and ending on the third anniversary of such
date (the "Employment Period").

      3. Terms of Employment.

            (a) Position and Duties.

                  (i)   During the Employment Period, (A) the Executive's
                        position (including status, offices, titles and
                        reporting requirements), authority, duties and
                        responsibilities shall be at least commensurate in all
                        material respects with the most significant of those
                        held, exercised and assigned at any time during the
                        120-day period immediately preceding the Effective Date
                        and (B) the Executive's services shall be performed at
                        the location where the Executive was employed
                        immediately preceding the Effective Date or any office
                        or location less than 35 miles from such location.

                  (ii)  During the Employment Period, and excluding any periods
                        of vacation and sick leave to which the Executive is
                        entitled, the Executive agrees to devote reasonable
                        attention and time during normal business hours to the
                        business and affairs of the Company and, to the extent
                        necessary to discharge the responsibilities assigned to
                        the Executive hereunder, to use the Executive's
                        reasonable best efforts to perform faithfully and
                        efficiently such responsibilities. During the Employment
                        Period it shall not be a violation of this Agreement for
                        the Executive to (A) serve on corporate, civic or
                        charitable boards or committees, and (B) manage personal
                        investments, so long as such activities do not
                        significantly interfere with the performance of the
                        Executive's responsibilities as an employee of the
                        Company in accordance with this Agreement.

            (b) Compensation.


                  (i)   Base Salary. During the Employment Period, the Executive
                        shall receive an annual base salary ("Annual Base
                        Salary"), which shall be



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                        paid at a monthly rate, at least equal to twelve times
                        the highest monthly base salary paid or payable,
                        including any base salary which has been earned but
                        deferred, to the Executive by the Company and its
                        affiliated companies in respect of the twelve-month
                        period immediately preceding the month in which the
                        Effective Date occurs. During the Employment Period, the
                        Annual Base Salary shall be reviewed no more than 12
                        months after the last salary increase awarded to the
                        Executive prior to the Effective Date and thereafter at
                        least annually. Any increase in Annual Base Salary shall
                        not serve to limit or reduce any other obligation to the
                        Executive under this Agreement. Annual Base Salary shall
                        not be reduced after any such increase and the term
                        Annual Base Salary as utilized in this Agreement shall
                        refer to Annual Base Salary as so increased. As used in
                        this Agreement, the term "affiliated companies" shall
                        include the Parent, the Subsidiaries, and any other
                        company controlled by, controlling or under common
                        control with the Company.

                  (ii)  Annual Bonus. In addition to Annual Base Salary, the
                        Executive shall be awarded, for each fiscal year ending
                        during the Employment Period, an annual bonus (the
                        "Annual Bonus") in cash at least equal to the
                        Executive's highest comparable bonus under any
                        predecessor or successor plan, for the last three full
                        fiscal years prior to the Effective Date (annualized in
                        the event that the Executive was not employed by the
                        Company for the whole of such fiscal year). Each such
                        Annual Bonus shall be paid no later than the end of the
                        third month of the fiscal year next following the fiscal
                        year for which the Annual Bonus is awarded, unless the
                        Executive shall elect to defer the receipt of such
                        Annual Bonus.

                  (iii) Incentive, Savings and Retirement Plans. During the
                        Employment Period, the Executive shall be entitled to
                        participate in all incentive, savings and retirement
                        plans, practices, policies and programs applicable
                        generally to other peer executives of the Company and
                        its affiliated companies, but in no event shall such
                        plans, practices, policies and programs provide the
                        Executive with incentive opportunities (measured with
                        respect to both regular and special incentive
                        opportunities, to the extent, if any, that such
                        distinction is applicable), savings opportunities and
                        retirement benefit opportunities, in each case, less
                        favorable, in the aggregate, than the most favorable of
                        those provided by the Company and its affiliated
                        companies for the Executive under such plans, practices,
                        policies and programs as in effect at any time during
                        the 120-day period immediately preceding the Effective
                        Date or if more favorable to the Executive, those
                        provided generally at any time after the Effective Date
                        to other peer executives of the Company and its
                        affiliated companies.



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                  (iv)  Welfare Benefit Plans. During the Employment Period, the
                        Executive and/or the Executive's family, as the case may
                        be, shall be eligible for participation in and shall
                        receive all benefits under welfare benefit plans,
                        practices, policies and programs provided by the Company
                        and its affiliated companies (including, without
                        limitation, medical, prescription, dental, disability,
                        employee life, group life, accidental death and travel
                        accident insurance plans and programs) to the extent
                        applicable generally to other peer executives of the
                        Company and its affiliated companies, but in no event
                        shall such plans, practices, policies and programs
                        provide the Executive with benefits which are less
                        favorable, in the aggregate, than the most favorable of
                        such plans, practices, policies and programs in effect
                        for the Executive at any time during the 120-day period
                        immediately preceding the Effective Date or, if more
                        favorable to the Executive, those provided generally at
                        any time after the Effective Date to other peer
                        executives of the Company and its affiliated companies.

                  (v)   Expenses. During the Employment Period, the Executive
                        shall be entitled to receive prompt reimbursement for
                        all reasonable expenses incurred by the Executive in
                        accordance with the most favorable policies, practices
                        and procedures of the Company and its affiliated
                        companies in effect for the Executive at any time during
                        the 120-day period immediately preceding the Effective
                        Date or, if more favorable to the Executive, as in
                        effect generally at any time thereafter with respect to
                        other peer executives of the Company and its affiliated
                        companies.

      4. Termination of Employment.

            (a)   Death or Disability. The Executive's employment shall
                  terminate upon the Executive's death during the Employment
                  Period. If the Company determines in good faith that the
                  Disability of the Executive has occurred during the Employment
                  Period (pursuant to the definition of Disability set forth
                  below), it may give to the Executive written notice in
                  accordance with Section 11(b) of this Agreement of its
                  intention to terminate the Executive's employment. In such
                  event, the Executive's employment with the Company shall
                  terminate effective on the 30th day after receipt of such
                  notice by the Executive (the "Disability Effective Date"),
                  provided that, within 30 days after such receipt, the
                  Executive shall not have returned to full-time performance of
                  the Executive's duties. For purposes of this Agreement,
                  "Disability"



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                  shall have the meaning set forth in the long-term disability
                  plan providing benefits to disabled executives of the Company
                  and its affiliated companies at the Disability Effective Date
                  or, if more favorable to the Executive, as in effect during
                  the 120-day period immediately preceding the Effective Date.
                  If there is no long term disability plan in effect for
                  executives at the Effective Date, "Disability" shall mean the
                  absence of the Executive from the Executive's duties with the
                  Company on a full-time basis for 180 consecutive business days
                  as a result of incapacity due to mental or physical illness
                  which is determined to be total and permanent by a physician
                  selected by the Company or its insurers and acceptable to the
                  Executive or the Executive's legal representative.

            (b)   Cause. The Company may terminate the Executive's employment
                  during the Employment Period for Cause. For purposes of this
                  Agreement, "Cause" shall mean:

                  (i)   the willful and continued failure of the Executive to
                        perform substantially the Executive's duties with the
                        Company or one of its affiliates to the extent, degree
                        and level of performance as provided in Section 3(a)(ii)
                        (other than any such failure resulting from incapacity
                        due to physical or mental illness), after a written
                        demand for substantial performance is delivered to the
                        Executive by the Board or the Chief Executive Officer of
                        the Company which specifically identifies the manner in
                        which the Board or Chief Executive Officer believes that
                        the Executive has not substantially performed the
                        Executive's duties, or

                  (ii)  the willful engaging by the Executive in illegal conduct
                        or gross misconduct which is materially and demonstrably
                        injurious to the Company.

                  For purposes of this provision, no act or failure to act, on
                  the part of the Executive, shall be considered "willful"
                  unless it is done, or omitted to be done, by the Executive in
                  bad faith or without reasonable belief that the Executive's
                  action or omission was in the best interests of the Company.
                  Any act, or failure to act, based upon authority given
                  pursuant to a resolution duly adopted by the Board or upon the
                  instructions of the Chief Executive Officer or a senior
                  officer of the Company or based upon the advice of counsel for
                  the Company shall be conclusively presumed to be done, or
                  omitted to be done, by the Executive in good faith and in the
                  best interests of the Company. The cessation of employment of
                  the Executive shall not be deemed to be for Cause unless and
                  until there shall have been delivered to the Executive a copy
                  of a resolution duly adopted by the affirmative vote of not
                  less than three-quarters of the entire membership of the Board
                  at a meeting of the Board called and held for such purpose
                  (after reasonable notice is provided to the Executive and the
                  Executive is given an opportunity, together with counsel, to
                  be heard before the Board), finding that, in the good faith
                  opinion of the Board, the Executive is guilty of the conduct
                  described in subparagraph (i) or (ii) above, and specifying
                  the particulars thereof in detail.



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            (c)   Good Reason. The Executive's employment may be terminated by
                  the Executive for Good Reason. For purposes of this Agreement,
                  "Good Reason" shall mean:

                  (i)   the assignment of the Executive to a position in which
                        the Executive's authority, duties or responsibilities
                        are materially diminished from the authority, duties or
                        responsibilities as contemplated by Section 3(a) of this
                        Agreement, or any other action by the Company or its
                        affiliated companies which results in a material
                        diminution in such position, authority, duties or
                        responsibilities, excluding for this purpose an
                        isolated, insubstantial and inadvertent action not taken
                        in bad faith and which is remedied by the Company
                        promptly after receipt of notice thereof given by the
                        Executive;

                  (ii)  any failure by the Company or its affiliated companies
                        to comply with any of the provisions of Section 3(b) of
                        this Agreement, other than an isolated, insubstantial
                        and inadvertent failure not occurring in bad faith and
                        which is remedied by the Company promptly after receipt
                        of notice thereof given by the Executive;

                  (iii) the Company's requiring the Executive to be based at any
                        office or location other than as provided in Section
                        3(a)(i)(B) hereof or the Company's requiring the
                        Executive to travel on Company business to a
                        substantially greater extent than required immediately
                        prior to the Effective Date;

                  (iv)  any purported termination by the Company of the
                        Executive's employment otherwise than as expressly
                        permitted by this Agreement; or

                  (v)   any failure by the Company to comply with and satisfy
                        Section 10(c) of this Agreement.

                  For purposes of this Section 4(c), any good faith
                  determination of Good Reason made by the Executive shall be
                  conclusive. Anything in this Agreement to the contrary
                  notwithstanding, a termination by the Executive for any reason
                  during the 30-day period immediately following the first
                  anniversary of the Effective Date shall be deemed to be a
                  termination for Good Reason for all purposes of this
                  Agreement.

            (d)   Notice of Termination. Any termination by the Company for
                  Cause, or by the Executive for Good Reason, shall be
                  communicated by Notice of Termination to the other party
                  hereto given in accordance with Section 11(b) of this
                  Agreement. For purposes of this Agreement, a "Notice of
                  Termination" means a written notice which (i) indicates the
                  specific termination provision in this Agreement relied upon,
                  (ii) to the extent



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                  applicable, sets forth in reasonable detail the facts and
                  circumstances claimed to provide a basis for termination of
                  the Executive's employment under the provision so indicated
                  and (iii) if the Date of Termination (as defined below) is
                  other than the date of receipt of such notice, specifies the
                  termination date (which date shall be not more than 30 days
                  after the giving of such notice). The failure by the Executive
                  or the Company to set forth in the Notice of Termination any
                  fact or circumstance which contributes to a showing of Good
                  Reason or Cause shall not waive any right of the Executive or
                  the Company, respectively, hereunder or preclude the Executive
                  or the Company, respectively, from asserting such fact or
                  circumstance in enforcing the Executive's or the Company's
                  rights hereunder.

            (e)   Date of Termination. "Date of Termination" means (i) if the
                  Executive's employment is terminated by the Company for Cause,
                  or by the Executive for Good Reason, the date of receipt of
                  the Notice of Termination or any later date specified therein,
                  as the case may be, (ii) if the Executive's employment is
                  terminated by the Company other than for Cause or Disability,
                  the Date of Termination shall be the date on which the Company
                  notifies the Executive of such termination, and (iii) if the
                  Executive's employment is terminated by reason of death or
                  Disability, the Date of Termination shall be the date of death
                  of the Executive or the Disability Effective Date, as the case
                  may be.

      5. Obligations of the Company upon Termination.

            (a)   Good Reason, Other Than for Cause, Death or Disability. If,
                  during the Employment Period, the Company shall terminate the
                  Executive's employment other than for Cause or Disability or
                  the Executive shall terminate employment for Good Reason:

                  (i)   the Company shall pay to the Executive in a lump sum in
                        cash within 30 days after the Date of Termination the
                        aggregate of the following amounts:

                        A.    the sum of (1) the Executive's Annual Base Salary
                              through the Date of Termination to the extent not
                              theretofore paid, (2) the product of (x) the
                              Annual Bonus which would have been paid for the
                              year in which the Executive's Date of Termination
                              occurs, and (y) a fraction, the numerator of which
                              is the number of days in the current fiscal year
                              through the Date of Termination, and the
                              denominator of which is 365 and (3) any
                              compensation previously deferred by the Executive
                              (together with any accrued interest or earnings
                              thereon) and any accrued vacation pay, in each
                              case to the extent not theretofore paid (the sum
                              of the



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                              amounts described in clauses (1), (2), and (3)
                              shall be hereinafter referred to as the "Accrued
                              Obligations"); and


                        B.    the amount equal to the sum of (x) one and
                              one-half (1 1/2) times the Executive's Annual Base
                              Salary and (y) the Executive's Target Bonus. For
                              purposes of the preceding sentence, the
                              Executive's Target Bonus shall be an amount equal
                              to the average of the annual bonuses received by
                              the Executive pursuant to the Company's Management
                              Incentive Plan (or any similar future bonus
                              program) for the preceding three years, provided,
                              however, that (a) any Target Bonus paid during
                              2002 shall be equal to $70,000, (b) any Target
                              Bonus paid during 2003 shall be equal to the
                              average of $70,000 and the 2002 actual bonus
                              amount and (c) any Target Bonus paid during 2004
                              shall be equal to the average of $70,000, the 2002
                              actual bonus amount and the 2003 actual bonus
                              amount.

                  (ii)  all stock options or restricted stock awarded to the
                        Executive by either the Parent or a successor by merger,
                        consolidation or otherwise, including, but not limited
                        to, all awards under the HealthAxis Inc. 2000 Stock
                        Option Plan, the Healthaxis.com, Inc. 1998 Amended and
                        Restated Stock Plan, and the Insurdata Incorporated 1999
                        Stock Option Plan, shall become 100% vested and, the
                        stock options shall be exercisable for a period equal to
                        thirty-six (36) months after the Executive's Date of
                        Termination; provided, however, that if the Executive
                        terminates his employment for "Good Reason" and the
                        basis for such "Good Reason" is voluntary resignation
                        during the 30 day period immediately following the first
                        anniversary of a Change in Control (as provided in the
                        final paragraph of Section 4(c)), then (a) the vesting
                        provisions of the Executive's restricted stock (if any)
                        and stock options shall remain unchanged, and (b) the
                        Executive's stock options shall be exercisable during
                        the exercise period provided in his stock option award
                        agreement and/or under the applicable option plan's
                        terms;

                  (iii) for twelve (12) months after the Executive's Date of
                        Termination, or such longer period as may be provided by
                        the terms of the appropriate plan, program, practice or
                        policy, the Company shall continue benefits to the
                        Executive and/or the Executive's family at least equal
                        to those which would have been provided to them in
                        accordance with the plans, programs, practices and
                        policies described in Section 3(b)(iv) of this Agreement
                        if the Executive's employment had not been terminated
                        or, if more favorable to the Executive, as in effect
                        generally at any time thereafter with respect to other
                        peer executives of the Company and its affiliated
                        companies and their families, provided, however, that if
                        the Executive becomes re-employed



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                        with another employer and is eligible to receive
                        equivalent medical or other welfare benefits under
                        another employer provided plan, the medical and other
                        welfare benefits described herein shall be secondary to
                        those provided under such other plan during such
                        applicable period of eligibility.

                  (iv)  the Company shall, at its sole expense as incurred,
                        provide the Executive with outplacement services for a
                        period of twelve (12) months, the provider of which
                        shall be selected by the Executive in his sole
                        discretion; and

                  (v)   to the extent not theretofore paid or provided, the
                        Company shall timely pay or provide to the Executive any
                        other amounts or benefits required to be paid or
                        provided or which the Executive is eligible to receive
                        under any plan, program, policy or practice or contract
                        or agreement of the Company and its affiliated companies
                        (such other amounts and benefits shall be hereinafter
                        referred to as the "Other Benefits").

            (b)   Death. If the Executive's employment is terminated by reason
                  of the Executive's death during the Employment Period, this
                  Agreement shall terminate without further obligations to the
                  Executive's legal representatives under this Agreement, other
                  than for payment of Accrued Obligations and the timely payment
                  or provision of Other Benefits. Accrued Obligations shall be
                  paid to the Executive's estate or beneficiary, as applicable,
                  in a lump sum in cash within 30 days of the Date of
                  Termination.

            (c)   Disability. If the Executive's employment is terminated by
                  reason of the Executive's Disability during the Employment
                  Period, this Agreement shall terminate without further
                  obligations to the Executive, other than for payment of
                  Accrued Obligations and the timely payment or provision of
                  Other Benefits. Accrued Obligations shall be paid to the
                  Executive in a lump sum in cash within 30 days of the Date of
                  Termination. With respect to the provision of Other Benefits,
                  the term Other Benefits as utilized in this Section 5(c) shall
                  include, and the Executive shall be entitled after the
                  Disability Effective Date to receive, disability and other
                  benefits at least equal to the most favorable of those
                  generally provided by the Company and its affiliated companies
                  to disabled executives and/or their families in accordance
                  with such plans, programs, practices and policies relating to
                  disability, if any, as in effect generally with respect to
                  other peer executives and their families at any time during
                  the 120-day period immediately preceding the Effective Date
                  or, if more favorable to the Executive and/or the Executive's
                  family, as in effect at any time thereafter generally with
                  respect to other peer executives of the Company and its
                  affiliated companies and their families.



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            (d)   Cause, Other than for Good Reason. If the Executive's
                  employment shall be terminated for Cause during the Employment
                  Period, this Agreement shall terminate without further
                  obligations to the Executive other than the obligation to pay
                  to the Executive (x) his Annual Base Salary through the Date
                  of Termination, (y) the amount of any compensation previously
                  deferred by the Executive, and (z) Other Benefits, in each
                  case to the extent theretofore unpaid. If the Executive
                  voluntarily terminates employment during the Employment
                  Period, excluding a termination for Good Reason, this
                  Agreement shall terminate without further obligations to the
                  Executive, other than for Accrued Obligations and the timely
                  payment or provision of Other Benefits. In such case, all
                  Accrued Obligations shall be paid to the Executive in a lump
                  sum in cash within 30 days of the Date of Termination.

      6. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or
limit the Executive's continuing or future participation in any plan, program,
policy or practice provided by the Company or any of its affiliated companies
and for which the Executive may qualify, nor, subject to Section 11(f), shall
anything herein limit or otherwise affect such rights as the Executive may have
under any contract or agreement with the Company or any of its affiliated
companies. Amounts which are vested benefits or which the Executive is otherwise
entitled to receive under any plan, policy, practice or program of or any
contract or agreement with the Company or any of its affiliated companies at or
subsequent to the Date of Termination shall be payable in accordance with such
plan, policy, practice or program or contract or agreement except as explicitly
modified by this Agreement.

      7. Full Settlement. The Company's obligation to make the payments provided
for in this Agreement and otherwise to perform its obligations hereunder shall
not be affected by any set-off, counterclaim, recoupment, defense or other
claim, right or action which the Company or any of its affiliated companies may
have against the Executive or others. In no event shall the Executive be
obligated to seek other employment or take any other action by way of mitigation
of the amounts payable to the Executive under any of the provisions of this
Agreement and, except to the extent provided in Section 5(a)(ii) hereof, such
amounts shall not be reduced whether or not the Executive obtains other
employment. The Company agrees to pay as incurred, to the full extent permitted
by law, all legal fees and expenses which the Executive may reasonably incur as
a result of any contest (regardless of the outcome thereof) by the Company or
any of its affiliated companies, the Executive or others of the validity or
enforceability of, or liability under, any provision of this Agreement or any
guarantee of performance thereof (including as a result of any contest by the
Executive about the amount of any payment pursuant to this Agreement), plus in
each case interest on any delayed payment at the applicable Federal rate
provided for in Section 7872(f)(2)(A) of the Code.

      8. Certain Additional Payments by the Company.

            (a)   Anything in this Agreement to the contrary notwithstanding and
                  except as set forth below, in the event it shall be determined
                  that any payment or distribution by the Company to or for the
                  benefit of the Executive (whether paid or payable or
                  distributed or distributable pursuant to the



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                  terms of this Agreement or otherwise, but determined without
                  regard to any additional payments required under this Section
                  8) (a "Payment") would be subject to the excise tax imposed by
                  Section 4999 of the Code or any interest or penalties are
                  incurred by the Executive with respect to such excise tax
                  (such excise tax, together with any such interest and
                  penalties, are hereinafter collectively referred to as the
                  "Excise Tax"), then the Executive shall be entitled to receive
                  an additional payment (a "Gross-Up Payment") in an amount such
                  that after payment by the Executive of all taxes (including
                  any interest or penalties imposed with respect to such taxes),
                  including, without limitation, any income taxes (and any
                  interest and penalties imposed with respect thereto) and
                  Excise Tax imposed upon the Gross-Up Payment, the Executive
                  retains an amount of the Gross-Up Payment equal to the Excise
                  Tax imposed upon the Payments.

            (b)   Subject to the provisions of Section 8(c), all determinations
                  required to be made under this Section 8, including whether
                  and when a Gross-Up Payment is required and the amount of such
                  Gross-Up Payment and the assumptions to be utilized in
                  arriving at such determination, shall be made by Ernst & Young
                  or such other certified public accounting firm as may be
                  designated by the Executive (the "Accounting Firm") which
                  shall provide detailed supporting calculations both to the
                  Company and the Executive within 15 business days of the
                  receipt of notice from the Executive that there has been a
                  Payment, or such earlier time as is requested by the Company.
                  In the event that the Accounting Firm is serving as accountant
                  or auditor for the individual, entity or group effecting the
                  Change in Control, the Executive shall appoint another
                  nationally recognized accounting firm to make the
                  determinations required hereunder (which accounting firm shall
                  then be referred to as the Accounting Firm hereunder). All
                  fees and expenses of the Accounting Firm shall be borne solely
                  by the Company. Any Gross-Up Payment, as determined pursuant
                  to this Section 8, shall be paid by the Company to the
                  Executive within five days of the receipt of the Accounting
                  Firm's determination. Any determination by the Accounting Firm
                  shall be binding upon the Company and the Executive. As a
                  result of the uncertainty in the application of Section 4999
                  of the Code at the time of the initial determination by the
                  Accounting Firm hereunder, it is possible that Gross-Up
                  Payments which will not have been made by the Company should
                  have been made ("Underpayment"), consistent with the
                  calculations required to be made hereunder. In the event that
                  the Company exhausts its remedies pursuant to Section 8(c) and
                  the Executive thereafter is required to make a payment of any
                  Excise Tax, the Accounting Firm shall determine the amount of
                  the Underpayment that has occurred and any such Underpayment
                  shall be promptly paid by the Company to or for the benefit of
                  the Executive.

            (c)   The Executive shall notify the Company in writing of any claim
                  by the Internal Revenue Service that, if successful, would
                  require the payment by



                                      -12-
<PAGE>



                  the Company of the Gross-Up Payment. Such notification shall
                  be given as soon as practicable but no later than ten (10)
                  business days after the Executive is informed in writing of
                  such claim and shall apprise the Company of the nature of such
                  claim and the date on which such claim is requested to be
                  paid. The Executive shall not pay such claim prior to the
                  expiration of the 30-day period following the date on which it
                  gives such notice to the Company (or such shorter period
                  ending on the date that any payment of taxes with respect to
                  such claim is due). If the Company notifies the Executive in
                  writing prior to the expiration of such period that it desires
                  to contest such claim, the Executive shall:

                  (i)   give the Company any information reasonably requested by
                        the Company relating to such claim,

                  (ii)  take such action in connection with contesting such
                        claim as the Company shall reasonably request in writing
                        from time to time, including, without limitation,
                        accepting legal representation with respect to such
                        claim by an attorney reasonably selected by the Company,

                  (iii) cooperate with the Company in good faith in order
                        effectively to contest such claim, and

                  (iv)  permit the Company to participate in any proceedings
                        relating to such claim;

                  provided, however, that the Company shall bear and pay
                  directly all costs and expenses (including additional interest
                  and penalties) incurred in connection with such contest and
                  shall indemnify and hold the Executive harmless, on an
                  after-tax basis, for any Excise Tax or income tax (including
                  interest and penalties with respect thereto) imposed as a
                  result of such representation and payment of costs and
                  expenses. Without limitation of the foregoing provisions of
                  this Section 8(c), the Company shall control all proceedings
                  taken in connection with such contest and, at its sole option,
                  may pursue or forego any and all administrative appeals,
                  proceedings, hearings and conferences with the taxing
                  authority in respect of such claim and may, at its sole
                  option, either direct the Executive to pay the tax claimed and
                  sue for a refund or contest the claim in any permissible
                  manner, and the Executive agrees to prosecute such contest to
                  a determination before any administrative tribunal, in a court
                  of initial jurisdiction and in one or more appellate courts,
                  as the Company shall determine; provided, however, that if the
                  Company directs the Executive to pay such claim and sue for a
                  refund, the Company shall advance the amount of such payment
                  to the Executive, on an interest-free basis and shall
                  indemnify and hold the Executive harmless, on an after-tax
                  basis, from any Excise Tax or income tax (including interest
                  or penalties with respect thereto) imposed with respect to
                  such advance or with respect to any imputed income with
                  respect to such advance; and



                                      -13-
<PAGE>



                  further provided that any extension of the statute of
                  limitations relating to payment of taxes for the taxable year
                  of the Executive with respect to which such contested amount
                  is claimed to be due is limited solely to such contested
                  amount. Furthermore, the Company's control of the contest
                  shall be limited to issues with respect to which a Gross-Up
                  Payment would be payable hereunder and the Executive shall be
                  entitled to settle or contest, as the case may be, any other
                  issue raised by the Internal Revenue Service or any other
                  taxing authority.

            (d)   If, after the receipt by the Executive of an amount advanced
                  by the Company pursuant to Section 8(c), the Executive becomes
                  entitled to receive any refund with respect to such claim, the
                  Executive shall (subject to the Company's complying with the
                  requirements of Section 8(c)) promptly pay to the Company the
                  amount of such refund (together with any interest paid or
                  credited thereon after taxes applicable thereto). If, after
                  the receipt by the Executive of an amount advanced by the
                  Company pursuant to Section 8(c), a determination is made that
                  the Executive shall not be entitled to any refund with respect
                  to such claim and the Company does not notify the Executive in
                  writing of its intent to contest such denial of refund prior
                  to the expiration of 30 days after such determination, then
                  such advance shall be forgiven and shall not be required to be
                  repaid and the amount of such advance shall offset, to the
                  extent thereof, the amount of Gross-Up Payment required to be
                  paid.

      9. Non-Compete, Confidential Information and Release.

            (a)   Covenant Not to Compete.

                  (i)   Compliance with the provisions of this Section 9 are an
                        express condition of the Executive's right to receive
                        payments, vesting, and benefits hereunder. The Executive
                        acknowledges and recognizes the confidential information
                        and records provided by the Company, the Parent, and its
                        subsidiaries, affiliates, successors, and assigns
                        (collectively, the "Employer"), the benefits provided
                        hereunder, and the professional training and experience
                        he will receive from and the contacts he will be
                        provided by the Employer, as well as the highly
                        competitive nature of the Employer's business, and in
                        consideration of all of the above, agrees that during
                        the period beginning on the effective date of the
                        Executive's termination of employment with the Employer
                        (the "Date of Termination") and ending eighteen (18)
                        months thereafter (the "Covered Time"), the Executive
                        will not compete with the business of the Employer. For
                        purposes hereof, "competition" shall mean any engaging,
                        directly or indirectly, in the "Covered Business" (as
                        hereinafter defined) in any state of the United States
                        of America or any nation in which the Employer is
                        conducting business as of the Date of Termination (the
                        "Covered Area"). For purposes of this Agreement,
                        "Covered Business" shall



                                      -14-
<PAGE>



                        mean providing any services similar in scope or nature
                        to the services provided by the Executive immediately
                        prior to his Date of Termination. For purposes of this
                        Section 9, the phrase "engaging, directly or indirectly"
                        shall mean engaging directly or having an interest,
                        directly or indirectly, as owner, partner, shareholder,
                        agent, representative, employee, officer, director,
                        independent contractor, capital investor, lender,
                        renderer of consultation services or advice or otherwise
                        (other than as the holder of less than 2% of the
                        outstanding stock of a publicly-traded corporation),
                        either alone or in association with others, in the
                        operation of any aspect of any type of business or
                        enterprise engaged in any aspect of the Covered
                        Business.

                  (ii)  The Executive agrees that during the term of this
                        Agreement (including any extensions thereof) and for the
                        twenty-four (24) months thereafter, he shall not (i)
                        directly or indirectly solicit or attempt to solicit any
                        of the employees, agents, consultants, or
                        representatives of the Employer or affiliates of the
                        Employer to leave any of such entities; or (ii) directly
                        or indirectly solicit or attempt to solicit any of the
                        employees, agents, consultants or representatives of the
                        Employer or affiliates of the Employer to become
                        employees, agents, representatives or consultants of any
                        other person or entity.

                  (iii) The Executive understands that the provisions of
                        Sections 9(a)(i) and (ii) may limit his ability to earn
                        a livelihood in a business similar to the business of
                        the Employer but nevertheless agrees and hereby
                        acknowledges that the restrictions and limitations
                        thereof are reasonable in scope, area, and duration, are
                        reasonably necessary to protect the goodwill and
                        business interests of the Employer, and that the
                        consideration provided under this Agreement is
                        sufficient to justify the restrictions contained in such
                        provisions. Accordingly, in consideration thereof and in
                        light of the Executive's education, skills and
                        abilities, the Executive agrees that he will not assert
                        that, and it should not be considered that, such
                        provisions are either unreasonable in scope, area, or
                        duration, or will prevent him from earning a living, or
                        otherwise are void, voidable, or unenforceable or should
                        be voided or held unenforceable.

            (b) Enforcement.

                  (i)   The parties hereto agree and acknowledge that the
                        covenants and agreements contained herein are reasonable
                        in scope, area, and duration and necessary to protect
                        the reasonable competitive business interests of the
                        Employer, including, without limitation, the value of
                        the proprietary information and goodwill of the
                        Employer.

                  (ii)  The Executive agrees that the covenants and undertakings
                        contained in Section 9 of this Agreement relate to
                        matters which are of a



                                      -15-
<PAGE>



                        special, unique and extraordinary character and that the
                        Employer cannot be reasonably or adequately compensated
                        in damages in an action at law in the event the
                        Executive breaches any of these covenants or
                        undertakings. Therefore, the Executive agrees that the
                        Employer shall be entitled, as a matter of course,
                        without the need to prove irreparable injury, to an
                        injunction, restraining order or other equitable relief
                        from any court of competent jurisdiction, restraining
                        any violation or threatened violation of any of such
                        terms by the Executive and such other persons as the
                        court shall order. The Executive agrees to pay costs and
                        legal fees incurred by the Employer in obtaining such
                        injunction.

                  (iii) Rights and remedies provided for in this Section 9(b)
                        are cumulative and shall be in addition to rights and
                        remedies otherwise available to the parties under any
                        other agreement or applicable law.

                  (iv)  In the event that any provision of this Agreement shall
                        to any extent be held invalid, unreasonable or
                        unenforceable in any circumstances, the parties hereto
                        agree that the remainder of this Agreement and the
                        application of such provision of this Agreement to other
                        circumstances shall be valid and enforceable to the
                        fullest extent permitted by law. If any provision of
                        this Agreement, or any part thereof, is held to be
                        unenforceable because of the scope or duration of or the
                        area covered by such provision, the parties hereto agree
                        that the court or arbitrator making such determination
                        shall reduce the scope, duration and/or area of such
                        provision (and shall substitute appropriate provisions
                        for any such unenforceable provisions) in order to make
                        such provision enforceable to the fullest extent
                        permitted by law, and/or shall delete specific words and
                        phrases, and such modified provision shall then be
                        enforceable and shall be enforced. The parties hereto
                        recognize that if, in any judicial proceeding, a court
                        shall refuse to enforce any of the separate covenants
                        contained in this Agreement, then that unenforceable
                        covenant contained in this Agreement shall be deemed
                        eliminated from these provisions to the extent necessary
                        to permit the remaining separate covenants to be
                        enforced. In the event that any court or arbitrator
                        determines that the time period or the area, or both,
                        are unreasonable and that any of the covenants is to
                        that extent unenforceable, the parties hereto agree that
                        such covenants will remain in full force and effect,
                        first, for the greatest time period, and second, in the
                        greatest geographical area that would not render them
                        unenforceable.

                  (v)   In the event of the Executive's breach of this Section
                        9, in addition to all other rights the Employer may have
                        hereunder or in law or in equity, all payments and
                        benefits hereunder shall cease; all options, stock, and
                        other securities granted by the Employer, including
                        stock



                                      -16-
<PAGE>



                        obtained through prior exercise of options, shall be
                        immediately forfeited (whether or not vested), and the
                        original purchase price, if any, shall be returned to
                        the Executive; and all profits received through exercise
                        of options or sale of stock, and all previous payments
                        and benefits made or provided hereunder shall be
                        promptly returned and repaid to the Company.

            (c)   Confidential Information. The Executive shall hold in a
                  fiduciary capacity for the benefit of the Company all secret
                  or confidential information, knowledge or data relating to the
                  Company or any of its affiliated companies, and their
                  respective businesses, which shall have been obtained by the
                  Executive during the Executive's employment by the Company or
                  any of its affiliated companies and which shall not be or
                  become public knowledge (other than by acts by the Executive
                  or representatives of the Executive in violation of this
                  Agreement). After termination of the Executive's employment
                  with the Company, the Executive shall not, without the prior
                  written consent of the Company or as may otherwise be required
                  by law or legal process, communicate or divulge any such
                  information, knowledge or data to anyone other than the
                  Company and those designated by it. In no event shall an
                  asserted violation of the provisions of this Section 9(c)
                  constitute a basis for deferring or withholding any amounts
                  otherwise payable to the Executive under this Agreement.

            (d)   Release. The Executive's execution of a complete and general
                  release of any and all of his potential claims (other than for
                  vested benefits described in this Agreement or any other
                  vested benefits with the Company and/or its affiliates)
                  against the Company, any of its affiliated companies, and
                  their respective successors and any officers, employees,
                  agents, directors, attorneys, insurers, underwriters, and
                  assigns of the Company, its affiliates and/or successors, is
                  an express condition of the Executive's right to receive
                  payments, vesting, and benefits hereunder. The Executive shall
                  be required to execute a Waiver and Release Agreement which
                  documents the release required under this Section 9(d), the
                  form of which shall be provided to the Executive by Company.

      10. Successors.

            (a)   This Agreement is personal to the Executive and without the
                  prior written consent of the Company shall not be assignable
                  by the Executive otherwise than by will or the laws of descent
                  and distribution. This Agreement shall inure to the benefit of
                  and be enforceable by the Executive's legal representatives.

            (b)   This Agreement shall inure to the benefit of and be binding
                  upon the Company and its successors and assigns.



                                      -17-
<PAGE>



            (c)   The Company will require any successor (whether direct or
                  indirect, by purchase, merger, consolidation or otherwise) to
                  all or substantially all of the business and/or assets of the
                  Company and/or the Parent to assume expressly and agree to
                  perform this Agreement in the same manner and to the same
                  extent that the Company would be required to perform it if no
                  such succession had taken place. As used in this Agreement,
                  "Company" shall mean the Company as hereinbefore defined and
                  any successor to its business and/or assets as aforesaid which
                  assumes and agrees to perform this Agreement by operation of
                  law, or otherwise.

      11. Miscellaneous.

            (a)   This Agreement shall be governed by and construed in
                  accordance with the laws of the State of Texas, without
                  reference to principles of conflict of laws. The captions of
                  this Agreement are not part of the provisions hereof and shall
                  have no force or effect. This Agreement may not be amended or
                  modified otherwise than by a written agreement executed by the
                  parties hereto or their respective successors and legal
                  representatives.

            (b)   All notices and other communications hereunder shall be in
                  writing and shall be given by hand delivery to the other party
                  or by registered or certified mail, return receipt requested,
                  postage prepaid, addressed as follows:

            IF TO THE EXECUTIVE:

                  JOHN D. SMITH
                  11 Twilight Circle
                  Collegeville, PA 19426

            IF TO THE COMPANY:

                  HEALTHAXIS, LTD.
                  5215 N.  O'Connor Blvd., Suite 800
                  Irving, Texas  75039
                          Attention: President

            WITH COPY TO:

                  HEALTHAXIS, LTD.
                  5215 N.  O'Connor Blvd., Suite 800
                  Irving, Texas  75039
                          Attention: General Counsel

                  or to such other address as either party shall have furnished
                  to the other in writing in accordance herewith. Notice and
                  communications shall be effective when actually received by
                  the addressee.



                                      -18-
<PAGE>



            (c)   The invalidity or unenforceability of any provision of this
                  Agreement shall not affect the validity or enforceability of
                  any other provision of this Agreement.

            (d)   The Company may withhold from any amounts payable under this
                  Agreement such Federal, state, local or foreign taxes as shall
                  be required to be withheld pursuant to any applicable law or
                  regulation.

            (e)   The Executive's or the Company's failure to insist upon strict
                  compliance with any provision of this Agreement or the failure
                  to assert any right the Executive or the Company may have
                  hereunder, including, without limitation, the right of the
                  Executive to terminate employment for Good Reason pursuant to
                  Section 4(c)(i)-(v) of this Agreement, shall not be deemed to
                  be a waiver of such provision or right or any other provision
                  or right of this Agreement.

            (f)   The Executive and the Company acknowledge that, except as may
                  otherwise be provided under any other written agreement
                  between the Executive and the Company, the employment of the
                  Executive by the Company is "at will" and, subject to Section
                  1(a) hereof, prior to the Effective Date, the Executive's
                  employment and/or this Agreement may be terminated by either
                  the Executive or the Company at any time prior to the
                  Effective Date, in which case the Executive shall have no
                  further rights under this Agreement. From and after the
                  Effective Date, this Agreement shall supersede any other
                  agreement between the parties with respect to the subject
                  matter hereof.

      IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and, pursuant to the authorization from its Board of Managers, the Company has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.


                                             EXECUTIVE:



                                             /s/ JOHN D. SMITH
                                             -----------------------------------
                                             John D. Smith



                                      -19-
<PAGE>



                                             HEALTHAXIS, LTD.

                                             By its General Partner,
                                             HEALTHAXIS MANAGING PARTNER, LLC


                                             By:  /s/ JAMES W. MCLANE
                                                  ------------------------------
                                                  James W. McLane
                                             Its: President & Manager

         The Compensation & Nominating Committee of Board of Directors of
HEALTHAXIS, INC. (the Parent) has authorized the undersigned officer to execute
the foregoing Change in Control Employment Agreement in order to indicate its
approval of such Agreement.

                                             HEALTHAXIS, INC.



                                             By:  /s/ BRENT WEBB
                                                  ------------------------------
                                                  Brent Webb
                                             Its: Secretary




                                      -20-