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Industrial Alliance Launches Diploma – a New Resp – and Six New Investment Funds

Quebec City,

News Release

Industrial Alliance Insurance and Financial Services announced today the launching of Diploma, a new registered education savings plan (RESP), and six new investment funds – segregated funds. These funds are part of Industrial Alliance´s Ecoflex family of funds and increase to 34 the number of funds the Company offers to individuals.

The new Diploma RESP was designed to help families systematically set aside funds each month to finance their children´s post-secondary education. Diploma offers the possibility to invest in an index type segregated fund whose performance is linked to the return of a portfolio composed of Canadian stocks and bonds, U.S. stocks and international stocks.

Diploma offers numerous advantages, including the possibility to make contributions through monthly payments of as little as $25 a month, accumulate investment income in a tax shelter, obtain a federal government grant under the RESP, make additional contributions at any time or transfer the accumulated investment income to an RRSP if the child does not pursue a post-secondary education.

Bonus paid by the Company
A unique feature on the market, Diploma also provides for Industrial Alliance to pay an education bonus of up to 15% of the total contributions made to the RESP, when the deposit period expires. This bonus supports the parents´ efforts to ensure their children´s future and is added to the federal grant, which is 20% of the annual contributions made.

"Given the enormous costs of obtaining a post-secondary education, it was important for Industrial Alliance to market a financial product that meets the needs of families who want to save for their children´s education," commented Clément Boivin, Director, Product and Concept Research. "Because of the high potential return that can be obtained by diversifying one´s portfolio, its many advantages and the bonus from Industrial Alliance, Diploma is the ideal investment tool to ensure a child´s future," Mr. Boivin continued.

Compared to a non-registered investment, the return on the amounts invested in Industrial Alliance´s Diploma RESP can be maximized thanks to the bonus paid by the Company, the federal grant and the growth of investment income in a tax shelter. For example, a monthly contribution of $100 to a Diploma RESP, for a two-year-old child, will generate $53,537 by the time the child reaches age 18, assuming a compound annual rate of return of 8%. On the other hand, the same investment made in a non-registered investment, using the same return assumption, will reach, $29,050, considering a 50% tax rate.

Anyone who cares about a child´s future can subscribe to the Diploma RESP, whether it be the parents, grandparents, an uncle, an aunt or even a friend. The same child can even be designated the beneficiary of more than one RESP by different subscribers, as long as the annual contribution limits per beneficiary are respected.

New Ecoflex investment funds
Industrial Alliance has also introduced six new investment funds (segregated funds), including three multi-management funds and three individual funds. The new multi-management funds aim to generate a high long-term return while minimizing the risk associated with market fluctuations. The amounts are invested in various asset categories, such as Canadian stocks, foreign stocks and fixed-income securities. The three new individual funds include a Canadian asset allocation fund and two superior growth funds. The six new funds join Industrial Alliance´s line of Ecoflex investment funds and offer the same guarantees at maturity or at death as the Company´s other funds.

The Diploma RESP and the six new Ecoflex funds are distributed by Industrial Alliance and its Vancouver subsidiary, IA Pacific Life.

The Industrial Alliance Group is among the most solid financial institutions in the country, where it exercises incontestable leadership in the fields of insurance and financial services. The Group has operations across Canada through the parent company, Industrial Alliance (Quebec City) and its subsidiaries, including IA Pacific Life (Vancouver) and National Life of Canada (Toronto). The seventh largest life insurance company in Canada, the Group has almost $14 billion in assets and funds under management. Industrial Alliance´s share is listed on the Toronto Stock Exchange and is on the TSE 300 index, where it is among the 100 largest Canadian companies.

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For information or to obtain documentation:
André Ménard
Director, Public Relations
Tel.: (418) 684-5000, extension 5286