TO: Our policyholders, agents and business partners
RE: Texas Mutual's Preparation Efforts for an Avian Flu Pandemic

The World Health Organization has assessed the threat of an avian flu pandemic at Stage 3 on a scale of 6. Stage 3 is the stage at which there is no or very limited human-to-human transmission and at which companies should develop risk mitigation plans. In recognition of this potential threat, Texas Mutual Insurance Company began its preparedness plan in April 2006 to further the twin goals of employee health and business continuity should such a threat become a reality.

This plan includes the following major activities:

1. Pandemic planning team. Texas Mutual Insurance Company’s president created and heads an interdisciplinary pandemic planning team made up of senior executives in the key areas of human resources, IT and facilities planning, and legal. This team meets regularly to prepare, refine and implement the plan, and to identify and respond to new issues as they arise.
2. Communications. Our company president issues periodic communications to the entire company. These communications keep employees informed of pandemic fundamentals, such as symptoms and modes of transmission; advise employees of the importance of good hygiene and other health-promoting steps; and let employees know what specific steps Texas Mutual Insurance Company is taking to be prepared.
3. Training. Texas Mutual Insurance Company loss prevention consultants have prepared information for our customers on the avian flu and how to combat the spread of germs and viruses. Like our other communications, this one emphasizes the importance of hand washing as a crucial hygiene habit in defending against this and other contagious diseases.
4. Facilities changes. Texas Mutual Insurance Company facilities have been adapted to further promote good health habits. These changes include hands-free devices in restrooms, the provision of antimicrobial cleaning products, and enhanced janitorial work. Texas Mutual Insurance Company has also identified temporary quarantine areas to contain infection should employees become sick at work.
5. Operational continuity. Texas Mutual Insurance Company division heads have developed plans that include dealing with vendors and planning for supplies in the event of a crisis. The plans also examine business processes and cross-training needs to keep operations running in the face of absenteeism. The plans identify opportunities and equipment needed for remote workspaces so that employees may continue to work, if necessary, while reducing their exposure to disease.
6. Workers' compensation insurance matters. Texas Mutual Insurance Company is examining in detail the legal issues surrounding compensability of illness in a pandemic flu situation so that we can make timely and appropriate decisions on coverage should the need arise.
7. Loss prevention assistance. Texas Mutual Insurance Company loss prevention consultants will supply basic guidelines, as well as information about resources available from public health authorities, to help our policyholders get started on their own individual pandemic preparations. Because our loss prevention consultants are not experts in this field, and because each policyholder's business is unique, our consultants will not be able to provide or evaluate detailed plans for policyholders.

Texas Mutual Insurance Company thanks you for entrusting your business to us. We know we need to earn that trust every day. Our pandemic preparation is but one part of our effort to be there for you in times of crisis, as well as times of business as usual.