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Industrial Alliance Announces Preferred Share Offering

Quebec City,

News Release

Prospectus

Industrial Alliance Insurance and Financial Services Inc. ("Industrial Alliance" or "the Company") today announced a Canadian public offering of $125 million of Non-Cumulative Class A Preferred Shares, Series B ("Series B Preferred Shares").

Industrial Alliance will issue 5 million Series B Preferred Shares priced at $25.00 per share and holders will be entitled to receive fixed non-cumulative preferential quarterly dividends in the amount of $0.2875 per share, to yield 4.60% per annum. The offering will be underwritten by a syndicate of investment dealers led by Scotia Capital Inc. The expected closing date for the offering is February 24, 2006. 

The Series B Preferred Shares will be issued under a prospectus supplement to Industrial Alliance's base shelf prospectus dated February 19, 2004. 

The Series B Preferred Shares have not been and will not be registered in the United States under the Securities Act of 1933, as amended, and will not be offered, sold or delivered in the United States. This press release does not constitute an offer to sell or a solicitation to buy the Series B Preferred Shares in the United States and any public offering of the shares in the United States must be made by means of a prospectus. 

About Industrial Alliance 

Founded in 1892, Industrial Alliance Insurance and Financial Services Inc. is a life and health insurance company that offers a wide range of life and health insurance products, savings and retirement plans, RRSPs, mutual and segregated funds, securities, auto and home insurance, mortgage loans and other financial products and services. The fifth largest life and health insurance company in Canada, Industrial Alliance is at the head of a large financial group - the Industrial Alliance Group - which has operations across Canada as well as in the Northwestern United States. Industrial Alliance insures over 1.7 million Canadians, employs more than 2,700 people and manages and administers over $38 billion in assets. Industrial Alliance stock is listed on the Toronto Stock Exchange under the ticker symbol IAG. Industrial Alliance is among the 100 largest public companies in Canada. 

Forward-Looking Statements 

This news release may contain forward-looking statements about the operations, objectives and strategies of Industrial Alliance Insurance and Financial Services Inc., as well as its financial situation and performance. These statements can generally be identified by the use of words such as "may," "expect," "anticipate," "intend," "believe," "estimate," "feel," "continue," or other similar expressions, competition, technological changes, global capital market activity, interest rates, changes in demographic data, changes in consumer demand for the Company's products and services, catastrophic events and general economic conditions in Canada or elsewhere in the world. This list is not exhaustive of the factors that may affect any of Industrial Alliance's forward-looking statements. These and other factors must be examined carefully and readers should not place undue reliance on Industrial Alliance's forward-looking statements. 

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Information: 
Jacques Carrière
Vice-President, Investor Relations
Office phone: (418) 684-5275
Cell phone: (418) 576-3624