2. Summary:
Reserves Established for Reassessment Process
Reserve Reserve Reserve
Addition Addition Addition
Multistate California
$ Millions
1Q-2006 3Q-2006 2Q-2007
4Q-2004 3Q-2005 Total
Incremental Direct Operating
Expense $27.5 $14.3 -- $15.0 ($12.8) $44.0
Benefit Costs from Claims
Reopened 44.0 37.3 86.0 310.4 65.8 543.5
Benefit Costs for Claims
Already in Inventory 40.5 15.4 -- -- -- 55.9
Fine 15.0 8.0 -- -- -- 23.0
Total Before-tax Charges $127.0 $75.0 $86.0 $325.4 $53.0 $666.4
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3. Status of Mailings and Return of RIFs
Actual at 1/20/08
Total Mailings to Eligible Claimants 290,903
Opt-Ins Received (including 974 No Notice Mailed) 79,396
Opt-Ins with Return Period Open -
Mailings Expired without Opt-in 212,481
RIFs Mailed 79,396
Completed RIFs Received 23,188
RIFs with Return Period Open 1
RIFs Expired 56,207
RIFs to be Mailed 0
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4. Profile of Reassessed Claims
Actual as of Actual as of
9/30/2007 1/20/2008
Claim Decisions Completed 22,932 23,188
Initial Decision - quot;Not Disabledquot; 51% 51%
% with Social Security Benefits 37% 37%
Results in:
Overturn Rate 41% 42%
Uphold Rate 59% 58%
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5. Claim Reassessment Results
Overturn Rate by Close Year *
50%
46%
44% 44%
43% 42%
Distribution of the Claims Expected 40%
37%
to be Reassessed by Close Year
30%
30%
1997-1999
2004-05 2,081 20%
3,885
2000 10%
3,654
2003
4,437 0%
1997-99 2000 2001 2002 2003 2004-05 Average
*23,188 claim decisions as of 1/20/2008
2001
Percent of Claims Reviewed for each Close Year
4,555
100%
2002
4,576 100% 100% 100% 100% 100% 100% 100%
80%
60%
(23,188 Total Estimated Claims)
40%
20%
0%
1997-99 2000 2001 2002 2003 2004-05 Average
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