Health Benefits Direct Announces Fourth Quarter and Fiscal Year 2008 Financial Results

Company Reduced Operating Loss and Makes Continued Progress On Its Restructuring Plan With the Sale of Its Agency Business


RADNOR, Pa., March 31, 2009 (GLOBE NEWSWIRE) -- Health Benefits Direct Corporation (OTCBB:HBDT), a leading technology innovator in the marketing, sales and administration of a range of insurance products, today announced its financial results for the fourth quarter and fiscal year ended December 31, 2008.

Fourth Quarter Highlights



    * Revenues of $5.6 million, compared to $6.0 million in the fourth
      quarter of 2007, due to reduced marketing and selling activity
      in Telesales.
    * Operating expenses decreased to $7.2 million from $10.6 million
      in the fourth quarter of 2007 as a result of cost cutting
      initiatives completed earlier in the year.
    * Net loss of $1.6 million, or ($0.04) per share, compared with a
      net loss of $4.5 million, or ($0.13) per share, in the fourth
      quarter of 2007.
    * At December 31, 2008, the Company had a cash balance of $1.8
      million, total assets of $8.7 million and total shareholders'
      equity of $1.9 million.

Fiscal Year Highlights



    * Revenues increased 17% to $24.1 million, compared to $20.7
      million in fiscal 2007, due to $5.6 million in revenues from
      Atiam offset by lower Telesales revenues.
    * Revenues of $97,177 from Insurint, the Company's proprietary,
      professional-grade web-based agent portal introduced to the
      market this year.
    * Net loss of $9.0 million, or $0.23 per share, compared with a
      net loss of $14.1 million, or $0.43 per share, in fiscal 2007.
    * Net decrease in cash of $3.9 million in fiscal 2008, compared to
      a net increase of $3.5 million for fiscal 2007.  The decrease in
      cash in 2008 was the result of net cash of $5.2 million from
      financing activities, which included $5 million from a private
      placement of common stock and warrants to certain institutional
      investors, less $8.3 million of net cash used in operations and
      $0.8 million of net cash used in investing activities.

Anthony Verdi, Acting Principal Executive Officer of Health Benefits Direct and Chief Financial Officer, commented, "We are very pleased with the significant progress we made during 2008 in restructuring our operations and executing on our strategic plan to better position the Company for long-term growth and profitability. By focusing on our technology businesses and exiting the agency segment of our business, we believe we are well positioned for future growth in our core markets. Additionally, we implemented strategic cost reductions to decrease our operating costs, and these efforts are reflected in our improved fourth quarter financial results.

"We remain confident about the growth potential of our technology platforms, which are gaining increasing acceptance in the market. We now have nine InsPro clients, and we are pleased with the progress we are making in growing this business. We recently enhanced the quoting capability of Insurint by adding more than 100 insurance companies to that platform and have also launched a powerful new integrated co-browsing tool."

Subsequent Events



    * Raised $4 million from a private placement of preferred stock
      and warrants on January 21, 2009 to an institutional investor.
    * Transferred the majority of its existing health insurance
      members and agreed to refer all of its ongoing health insurance
      prospects to an unaffiliated third party on February 20, 2009.
    * Received $1.3 million in cash, of which $1.0 million was used to
      repay certain liabilities and transferred $1.4 million of
      liabilities in exchange for the transfer of its existing health
      insurance members and referrals of its ongoing health insurance
      prospects. This business represents approximately 66% of the
      Company's total revenues.
    * Ceased the direct marketing and sale of health and life
      insurance and related products to individuals and families and
      reduced staff.
    * The Company's cash balance at February 28, 2009 was $4.5 million.

Anthony Verdi remarked, "We completed another major step in the Company's restructuring with the sale of its agency business. We are now focused on providing InsPro and Insurint the financial support and resources needed to demonstrate the strength of these growing technology businesses."

About Health Benefits Direct Corporation

Through its subsidiary, Atiam Technologies, Health Benefits Direct offers InsPro software, an internet-based marketing and administration system used by Insurance carriers and Third Party Administrators. Through its subsidiary, Insurint Corporation, Health Benefits Direct provides a proprietary, professional-grade, web-based agent quote engine portal that aggregates real-time quotes from more than 100 health insurance carriers, life insurance carriers and carriers of related insurance products. www.healthbenefitsdirect.com

Forward-Looking Statements

In addition to historical facts or statements of current condition, this press release contains forward-looking statements within the meaning of the "Safe Harbor" provisions of The Private Securities Litigation Reform Act of 1995, including statements regarding the growth potential of our technology platforms and providing the financial support and resources needed to demonstrate the strength of these growing technology businesses. Forward-looking statements provide Health Benefits Direct's current expectations or forecasts of future events. Moreover, Health Benefits Direct cautions readers that forward-looking statements are subject to certain risks and uncertainties, which could cause actual results to differ materially from the statements made, including risks described in Health Benefit Direct's most recent Quarterly Reports on Form 10-Q or Annual Reports on Form 10-K filed with the Securities and Exchange Commission and available on Health Benefits Direct's website at www.healthbenefitsdirect.com. These documents are also available on the Securities and Exchange Commission's website at www.sec.gov. Health Benefits Direct does not undertake any obligation to update any forward-looking statement to conform the statement to actual results or changes in expectations.



           HEALTH BENEFITS DIRECT CORPORATION AND SUBSIDIARIES
                       CONSOLIDATED BALANCE SHEET

                                            December 31,   December 31,
                                               2008            2007
                                            -----------    -----------

                     ASSETS

 CURRENT ASSETS:
  Cash                                      $ 1,842,419    $ 5,787,585
   Accounts receivable, less allowance for
    doubtful accounts $2,173 and $59,106        919,868      1,720,014
   State tax receivable                          31,290             --
   Deferred compensation advances                36,186        578,372
   Prepaid expenses                             177,833        182,087
   Other current assets                           8,461         22,285
                                            -----------    -----------

    Total current assets                      3,016,057      8,290,343

   Restricted cash                            1,150,000      1,150,000
   Property and equipment, net of
    accumulated depreciation $1,545,150
    and $1,115,562                            1,163,948      1,592,480
   Intangibles, net of accumulated
    amortization $4,859,779 and $3,108,771    3,198,407      5,095,960
   Other assets                                 180,641        165,871
                                            -----------    -----------

    Total assets                            $ 8,709,053    $16,294,654
                                            ===========    ===========

      LIABILITIES AND SHAREHOLDERS' EQUITY

 CURRENT LIABILITIES:
   Accounts payable                         $   912,751    $ 1,483,064
   Accrued expenses                           2,030,948      1,406,641
   Current portion of capital lease
    obligations                                  89,297         14,707
   Sub-tenant security deposit                   39,093             --
   Due to related parties                         4,315         28,500
   Unearned commission advances               3,022,161      8,450,585
   Deferred revenue                             457,500        209,125
   Income tax payable                                --        157,288
                                            -----------    -----------

    Total current liabilities                 6,556,065     11,749,910
                                            -----------    -----------

 LONG TERM LIABILITIES:
   Deferred tax liability                            --             --
   Capital lease obligations                    209,511         44,241
                                            -----------    -----------

    Total long term liabilities                 209,511         44,241
                                            -----------    -----------

 SHAREHOLDERS' EQUITY:
   Preferred stock ($.001 par value;
    10,000,000 shares authorized; no shares
    issued and outstanding)                          --             --
   Common stock ($.001 par value;
    90,000,000 shares authorized; 41,279,645
    and 34,951,384 shares issued and
    outstanding                                  41,279         34,951
   Additional paid-in capital                43,281,139     36,868,409
   Accumulated deficit                      (41,378,941)   (32,402,857)
                                            -----------    -----------

    Total shareholders' equity                1,943,477      4,500,503
                                            -----------    -----------

    Total liabilities and
     shareholders' equity                   $ 8,709,053    $16,294,654
                                            ===========    ===========


           HEALTH BENEFITS DIRECT CORPORATION AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF OPERATIONS

                     For the Three Months        For the Years Ended
                      Ended December 31,            December 31,
                   ------------------------- -------------------------
                        2008        2007         2008         2007
                   ------------ ------------ ------------ ------------
                    (Unaudited)  (Unaudited)

 Revenues          $  5,629,551 $  6,005,203 $ 24,128,027 $ 20,709,750


 Operating
  Expenses:
  Salaries,
  commission
   and related
   taxes              3,128,724    5,214,749   17,132,830   17,544,167
  Lead, advertising
   and other
   marketing            482,687    2,516,253    4,390,483    8,489,695
  Depreciation and
   amortization         616,494      655,585    2,568,145    2,286,767
  Rent, utilities,
   telephone and
   communications     1,371,976      786,436    3,509,713    2,720,735
  Professional fees     988,503      784,762    2,948,503    2,062,107
  Loss on
   impairment of
   property and
   equipment                 --           --       88,922           --
  Loss on impairment
   of intangible
   asset                 85,078           --      380,711      125,000
  Other general and
   administrative       570,268      651,194    2,072,431    1,934,320
                   ------------ ------------ ------------ ------------

                      7,243,730   10,608,979   33,091,738   35,162,791
                   ------------ ------------ ------------ ------------

 Loss from
  operations         (1,614,179)  (4,603,776)  (8,963,711) (14,453,041)
                   ------------ ------------ ------------ ------------

 Other income
  (expense):
  Gain (Loss) on
   disposal of
   property and
   equipment             45,895           --      (46,479)      (2,592)
  Interest income         6,794       70,743       73,913      350,707
 Interest expense       (11,903)      (9,848)     (39,807)     (31,673)
                   ------------ ------------ ------------ ------------

  Total other
   income (expense)      40,786       60,895      (12,373)     316,442
                   ------------ ------------ ------------ ------------

 Net loss          $ (1,573,393)$ (4,542,881)$ (8,976,084)$(14,136,599)
                   ============ ============ ============ ============

 Net loss per
  common share:
  Net loss per
   common share -
   basic and
   diluted         $      (0.04)$      (0.13)$      (0.23)$      (0.43)
                   ============ ============ ============ ============

 Weighted average
  common shares
  outstanding -
  basic and diluted  41,279,645   34,867,255   39,734,505   33,006,127
                   ============ ============ ============ ============


          HEALTH BENEFITS DIRECT CORPORATION AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF CASH FLOWS

                                              For the Years Ended
                                                 December 31,
                                          ----------------------------
                                              2008            2007
                                          ------------   -------------
 Cash Flows From Operating Activities:
 Net loss                                 $ (8,976,084)  $ (14,136,599)
 Adjustments to reconcile net loss to net
  cash used in operating activities:
   Depreciation and amortization             2,568,145       2,286,767
   Stock-based compensation and consulting   1,516,686       1,772,031
   Loss on impairment of property and
    equipment                                   88,922              --
   Loss on impairment of intangible assets     380,711              --
   Loss on the disposal of property and
    equipment                                   46,479              --
   Provision for bad debt                       46,748         (20,317)
 Changes in assets and liabilities:
   Accounts receivable                         753,398       1,140,843
   State tax receivable                        (31,290)             --
   Deferred compensation advances              542,186         106,626
   Prepaid expenses                              4,254         (71,944)
   Other current assets                         13,824         (11,274)
   Other assets                                (14,770)        (61,308)
   Accounts payable                           (570,313)        288,532
   Accrued expenses                            599,301        (143,662)
   Sub-tenant security deposit                  39,093              --
   Due to related parties                      (24,185)        (35,172)
   Unearned commission advances             (5,428,424)      3,295,468
   Deferred revenue                            248,375          51,837
   Income tax payable                         (157,288)         37,288
                                          ------------   -------------

     Net cash used in operating
      activities                            (8,354,232)     (5,500,884)
                                          ------------   -------------

 Cash Flows From Investing Activities:
   Purchase of property and equipment         (533,661)       (555,787)
   Proceeds from the sale of property and
    equipment                                   64,950              --
   Purchase of intangible assets and
    capitalization of software development    (291,847)     (1,331,233)
                                          ------------   -------------

     Net cash used in investing
      activities                              (760,558)     (1,887,020)
                                          ------------   -------------

 Cash Flows From Financing Activities:
   Capital leases obligations assumed               --          19,081
   Gross proceeds from capital leases          282,271          41,875
   Payments on capital leases                  (42,409)         (2,008)
   Gross proceeds from sales of common
    stock                                    5,000,000      11,250,000
   Gross proceeds from exercise of
    warrants                                        --         450,000
   Placement and other fees paid in
    connection with offering                   (70,238)       (895,240)
                                          ------------   -------------

     Net cash provided by financing
      activities                             5,169,624      10,863,708
                                          ------------   -------------

     Net increase (decrease) in cash        (3,945,166)      3,475,804

 Cash - beginning of the year                5,787,585       2,311,781
                                          ------------   -------------

 Cash - end of the year                   $  1,842,419   $   5,787,585
                                          ============   =============

            

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