Milliman 2026 Actuarial Adequacy Report

Presented September 23, 2026

Florida Prepaid College Board 2026 Actuarial Adequacy Report

Prepared by:

Alan Perry, FSA, CFA, MAAA Principal & Consulting Actuary (Philadelphia)

Matt Larrabee, FSA, EA, MAAA Principal & Consulting Actuary (Portland)

Milliman, Inc.

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1455 SW Broadway, Suite 1600 Portland, OR 97201

Tel (Philadelphia) +1 610 687 5644 Tel (Portland) +1 503 227 0634 milliman.com

Milliman

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional when reviewing the Milliman work product.

Table of Contents

Executive Summary A. Summary of Key Valuation Results B. Actuarial Discussion and Analysis C. Program Experience D. Changes in Actuarial Assumptions and Methods E. Changes in Program Provisions

Exhibits Market Value of Assets Change in Market Value of Assets Projected Fiscal Year-by-Fiscal Year Program Benefit Payments, Cancellations and Expenses Projected Fiscal Year-by-Fiscal Year Total Disbursements Less Premium Payments Discount Rate Yield Curves Used in Current and Prior Valuations Actuarial Adequacy Reserve as of June 30, 2026 Change in Actuarial Adequacy Reserve from June 30, 2025 to June 30, 2026 History of Actuarial Adequacy Reserve Program Termination Liability as of June 30, 2026

Certification

Appendices Appendix A – Actuarial Assumptions and Methods Appendix B – Summary of Principal Program Provisions Appendix C – Summary Contract Data - Matriculation 2026 and Prior Appendix D – Summary Contract Data – Matriculation 2027 and Later

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Executive Summary

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

A. Summary of Key Valuation Results

Adequacy Valuation as of:

June 30, 2025 June 30, 2026

Resources Invested Assets at Fair Market Value Present Value of Projected Future Premium Contributions* Total Resources

$13,064,000,000

1,779,000,000 $14,843,000,000

$13,961,000,000

1,972,000,000 $15,933,000,000

Obligations Present Value of Projected Future:

Program Benefits Cancellation Refunds Certain Expenses** Present Value of Projected Future Obligations* Near-Term Payable Amounts Total Liability Obligations

$7,106,000,000 1,312,000,000

733,000,000 9,151,000,000

333,000,000 $9,484,000,000

$7,338,000,000 1,181,000,000 1,102,000,000 9,621,000,000

340,000,000 $9,961,000,000

Actuarial Adequacy Reserve Actuarial Adequacy Reserve (Resources Less Obligations) Adequacy Reserve as a % of Total Liability Obligations

$5,359,000,000 56.5%

$5,972,000,000 60.0%

Other Metric

Single Effective Discount Rate for Total Obligations Calculation

4.90%

5.07%

* For current contracts in force as of the valuation date.

** Asset management, administrative budget, and lockbox.

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

B. Actuarial Discussion and Analysis A comprehensive adequacy valuation of the Stanley G. Tate Florida Prepaid College Program (the “Program”) is conducted annually, with interim valuation updates quarterly, to analyze the ability of projected Program resources to fully meet projected Program contract obligations and Program expenses. Consistent with Section 1009.98(10)(a)1 of Florida Statutes, the actuarial adequacy reserve is the amount stated in present value terms by which the expected value of Program assets including projected future contributions for contracts currently in force (resources) exceeds the projected value of Program liabilities, including expenses (obligations). The calculation is done as of a single point in time, using a single set of actuarial assumptions and methods as approved by the Florida Prepaid College Board (the “Board”).

While the adequacy analysis uses a single set of actuarial assumptions, actual future Program experience will differ from the assumptions used in the adequacy valuation’s calculations. Given that, the use of assumptions which in combined effect include a margin of conservatism to account for potential adverse actual future Program experience is prudent. Per its statutory role, the final decisions regarding the assumptions used in the adequacy valuation and the appropriate margin of conservatism to include in those assumptions reside with the Board.

With exceptions as noted in this report, the valuation was conducted using the same actuarial assumptions and methods used in the adequacy valuation conducted as of June 30, 2025. The assumptions used were approved by the Board, based on the Board’s review of Program experience and economic conditions.

C. Program Experience “Experience” encompasses the performance of the Program during the year, including investment performance, along with the effects of changes in the discount rate yield curve, tuition, fees, and the Program’s contract data.

The Program experience during the year is quantified through changes in the actuarial adequacy reserve. The year-to-year changes in the reserve are detailed in Exhibit 7 of the report. The adequacy reserve increased by $613 million during the year. The key sources of reserve decrease during the year were:

$94 million – effect of changes to the pre-matriculation cancellation assumption

$106 million – effect of new contract sales during the most recent enrollment window

$343 million – effect of changes to projected future administrative expenses

These factors were more than offset by sources of reserve increase:

$760 million – investment gains on the non-liability-hedging reserve assets

$29 million – impact from the immunized fixed income strategy

$421 million – lower actual 2026-27 tuition and dormitory costs compared to those assumed in the 2025 adequacy valuation

The line-item contributions of each distinct source of year-to-year change in the adequacy reserve are shown in Exhibit 7. The effect of all sources not separately identified was a reserve decrease of $54 million, which is approximately 0.5% of program obligations.

The impact of the immunized fixed income strategy combines the effects on the reserve from changes to the market value of the liability-hedging fixed income investments and changes to the discounted present value of Program liability obligations and future premium payments due to discount rate yield curve shifts and the passage of time. The magnitude of this change is the outcome of an asset/liability immunization policy, where fixed income assets are invested in such a manner that decreases (or increases) in Program liabilities due to yield curve shifts will be mirrored to a significant extent by a corresponding decrease (or increase) in the market value of the Program’s liability-hedging fixed income investments.

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

D. Changes in Actuarial Assumptions and Methods The actuarial assumptions and methods used in this valuation are the same as those used in the valuation conducted as of June 30, 2025 except as summarized below, with more details in Appendix A:

The discount rate yield curve was updated to reflect changes in capital market conditions between annual valuation dates.

The annual budget, lockbox expenses, and investment management fees were updated to reflect current costs. These expenses are the “certain projected future expenses” in the reserve calculation.

The pre-matriculation cancellations were updated in accordance with recent experience.

Please see Appendix A for a more detailed summary of this valuation’s actuarial assumptions and methods.

E. Changes in Program Provisions There have been no changes in Program provisions that affect actuarial calculations since the prior valuation.

Please see Appendix B for a summary of the principal Program provisions.

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Exhibits

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Exhibit 1

Market Value of Assets The fair market value of assets as of June 30, 2025 and June 30, 2026 is shown below and was provided by Program administrative staff.

June 30, 2025 June 30, 2026

1. Liability hedging fixed income

2. Core fixed income

3. Short term fixed income

4. Domestic equity

5. International equity

6. Cash / short-term investments

7. Cash in checking accounts

8. Market value of assets

$ 8,220,000,000

1,357,000,000

2,308,000,000

1,052,000,000

121,000,000

6,000,000

$13,064,000,000

$ 8,460,000,000

1,181,000,000

1,419,000,000

1,975,000,000

841,000,000

69,000,000

16,000,000

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Exhibit 2

Change in Market Value of Assets The change in the market value of assets from June 30, 2025 to June 30, 2026 is shown below and was provided by Program administrative staff.

1. Market value of assets as of June 30, 2025 $13,064,000,000

2. Net contribution, disbursement, and operating activity (168,000,000)

3. Investment performance

a. Dividend and interest income

b. Realized gains / (losses)

c. Unrealized gains / (losses)

d. Net securities lending income

e. Commission, fees and expenses Total investment performance

310,000,000 185,000,000 565,000,000

6,000,000 (1,000,000)

1,065,000,000

4. Net increase / (decrease) in market value of assets [(2) + (3)]

897,000,000

5. Market value of assets as of June 30, 2026 [(1) + (4)]

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional when reviewing the Milliman work product.

Exhibit 3

Projected Fiscal Year-by-Fiscal Year Program Benefit Payments, Cancellations and Expenses Projections are based on the assumptions and methods used in this year’s adequacy reserve valuation, including the effect of applying “catch-up” inflation assumptions to projected 2027-2028 costs. Figures represent payments from contracts currently in force as of the valuation date, with no projections for payments due to contracts purchased after the valuation date. Results are shown in $ millions and the years in the chart represent the respective Program year end (e.g., the “2027” entry represents projected Program benefit payments, cancellations and expenses for the 2026-2027 Program year).

$0

$100

$200

$300

$400

$500

$600

$700

$800

$900

$1,000

2027 2029 2031 2033 2035 2037 2039 2041 2043 2045 2047 2049 2051 2053

Contract Benefits Cancellation Refunds Expenses Total Disbursements

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified

Exhibit 4

Projected Fiscal Year-by-Fiscal Year Total Disbursements Less Premium Payments The green line on the graph below shows the difference fiscal year-by-fiscal year between projected total disbursements (yellow line) and projected contract premium payments (blue line). A proxy for an immunization-style fixed income investment policy would be to match projected fixed income proceeds to the green line. The projections below are based on the assumptions and methods used in this year’s adequacy reserve valuation and represent contributions and disbursements from contracts currently in force as of the valuation date, with no projections for contributions or disbursements for contract purchases after the valuation date. Projections included the effect of applying “catch-up” inflation assumptions in 2027- 2028. Amounts are shown in $ millions and the years in the chart represent the respective Program year end (e.g., the “2027” entry represents projected total disbursements and premium payments for the 2026-2027 Program year).

-$400

-$200

$0

$200

$400

$600

$800

$1,000

2027 2029 2031 2033 2035 2037 2039 2041 2043 2045 2047 2049 2051 2053

Total Disbursements Premium Payments Total Disbursements Less Premium Payments

O ut flo w

In flo w

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified

Exhibit 5

Discount Rate Yield Curves Used in Current and Prior Valuations The present values of projected Program obligations and projected future premium contributions are calculated using discount rate yield curves developed by the Program’s investment consultant and provided to Milliman by Program staff. The yield curve is based on US Treasury spot rates increased by an option adjusted spread determined by the Program’s investment consultant. The US Treasury spot rates as of the two most recent annual adequacy valuation dates, followed by the discount rate yield curves used in the current and prior valuations are shown below. The equivalent single effective interest rate used to determine Total Program Obligations as calculated by Milliman increased 17 basis points from 4.90% in the June 30, 2025 valuation to 5.07% in this June 30, 2026 valuation.

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Years Until Payment

U.S. Treasury Spot Rates 6/30/2025

U.S. Treasury Spot Rates 6/30/2026 + 18 bps

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Years Until Payment

Spot Rates + Spread 6/30/2025

Spot Rates + Spread 6/30/2026 + 17 bps

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Exhibit 6

Actuarial Adequacy Reserve as of June 30, 2026 Consistent with Section 1009.98(10)(a)1 of Florida Statutes, the actuarial adequacy reserve is the amount stated in present value terms by which the expected value of Program assets including projected future contributions for contracts currently in force (resources) exceeds the projected value of Program liabilities, including expenses (obligations). The calculation is done as of a single point in time, using a single set of actuarial assumptions and methods approved by the Program’s Board. Present values are calculated using the discount rate yield curve shown in Exhibit 5.

1. Assets at fair market value as of June 30, 2026 $13,961,000,000

2. Present value of expected future premium contributions 1,972,000,000

3. Total Program resources [(1) + (2)] $15,933,000,000

4. Present value of projected future Program benefits 7,338,000,000

5. Present value of projected future cancellation refunds 1,181,000,000

6. Present value of certain* projected future expenses 1,102,000,000

7. Present value of projected future obligations [(4) + (5) + (6)]

$ 9,621,000,000

8. Near-term payable amounts 340,000,000

9. Total Program obligations [(7) + (8)]

$ 9,961,000,000

10. Actuarial adequacy reserve as of June 30, 2026 [(3) - (9)]

$ 5,972,000,000

11. Adequacy reserve as a percentage of total Program obligations [(10) ÷ (9)]

60.0%

* Asset management, administrative budget, and lockbox.

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Exhibit 7

Change in Actuarial Adequacy Reserve from June 30, 2025 to June 30, 2026 A number of factors contributed to the year-to-year change in the actuarial adequacy reserve, as quantified below.

1. Actuarial adequacy reserve as of June 30, 2025 $5,359,000,000

Increase/(decrease) in reserve from June 30, 2025 to June 30, 2026 due to:

2. Investment earnings on non-liability hedging reserve assets

3. Immunization*

4. Actual 2026-2027 tuition and fee policy**

5. Changes in assumptions regarding certain projected future expenses

6. New contract sales during year

7. Change in pre-matriculation cancellation assumptions

8. Actual contract usage/cancellation behavior**, and all other sources

9. Total increase/(decrease) in actuarial adequacy reserve during the year

10. Actuarial adequacy reserve as of June 30, 2026

760,000,000 29,000,000

421,000,000 (343,000,000) (106,000,000) (94,000,000) (54,000,000)

613,000,000

$5,972,000,000

* Immunization reflects the combined net effect of the investment return on liability-hedging fixed income investments and changes to the present values of Program obligations and projected future premium payments due to changes in the annual adequacy reserve valuation’s discount rate yield curve and the passage of time between June 30, 2025 and June 30, 2026. It also reflects the difference between the annual adequacy reserve valuation’s liability and the hedging portfolio’s benchmark liability. The annual adequacy reserve valuation’s liability is a closed group measure of the obligations for active contracts already in force as of the valuation date.

The portfolio benchmark liability, in contrast, also includes obligations for up to five additional years of projected contract sales. The portfolio benchmark liability has a greater present value and also a longer duration than the annual adequacy reserve valuation liability. These two factors account for the positive $29 million impact on the annual adequacy reserve from immunization. If we included five years of additional projected future contract sales in the adequacy reserve liability calculation, the immunization impact on the adequacy reserve would have been positive $11 million.

** Compared to that assumed in the prior annual adequacy reserve valuation as of June 30, 2025.

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

Actuarial Adequacy Reserve ($millions)

Liabilities Assets Reserve

Exhibit 8

History of Actuarial Adequacy Reserve

Reserve:

In $ millions $1,657 $2,397 $2,984 $3,697 $3,590 $4,704 $4,082 $4,895 $4,921 $5,359 $5,972

As % of liability 14.0% 21.5% 27.8% 32.7% 29.7% 40.6% 40.7% 51.9% 53.6% 56.5% 60.0%

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Exhibit 9

Program Termination Liability as of June 30, 2026 Program termination liability is calculated in accordance with Florida Statutes and guidance from the Board. In the Program termination liability calculation, the contract population is divided into two subsets, with differing liability determination methods applied to each subset.

In this valuation, Subset A consists of contracts with a projected enrollment year of 2030 or earlier. Subset A contracts are valued assuming that premium payments continue (where applicable) and that all purchased contract benefits are paid after matriculation.

In this valuation, Subset B consists of contracts with a projected enrollment year of 2031 or later. Subset B contracts are valued assuming a refund of all past premium payments, including interest at passbook rates.

1. Subset A liability

a. Present value of projected future Program benefit payments

b. Present value of projected future premium payments

c. Subset A liability: [(1a) - (1b)]

$5,192,000,000

182,000,000 $5,010,000,000

2. Subset B liability

a. Refund of past premium payments

b. Interest due on past premium payments

c. Subset B liability: [(2a) + (2b)]

3. Program termination liability as of June 30, 2026: [(1c) + (2c)]

$ 2,352,000,000

4,000,000 $2,356,000,000

$7,366,000,000

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Certification

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Caveats and Limitations of Use The actuarial valuation of the Stanley G. Tate Florida Prepaid College Program (the “Program”) as of June 30, 2026 has been completed in accordance with our understanding of Program provisions as specified by Florida Statutes using assumptions and methods as approved by the Florida Prepaid College Board (the “Board”). It also has been completed in accordance with our understanding of any applicable guidance or interpretations provided by the Program’s administrative staff. The valuation results contained in this report are based on the actuarial assumptions and methods (Appendix A), principal Program provisions (Appendix B), and contract data (Appendix C, Appendix D) summarized in the appendices.

Purpose of the Valuation The adequacy reserve portion of the actuarial valuation assesses, as of a single point in time, the estimated sufficiency of Program resources (assets currently held and estimated future premium contributions for contracts currently in force) to satisfy Program obligations (estimated future Program benefit payments and administrative expenses). The adequacy reserve valuation uses assumptions and methods approved by the Board.

The Program termination portion of the actuarial valuation assesses, as of a single point in time, the estimated level of Program termination liability using parameters as specified by Section 1009.98(8) of Florida Statutes and by the Board.

Assumptions and Methods All liabilities shown in this report have been determined on the basis of actuarial assumptions and methods set forth in Appendix A and as approved by the Board. The assumptions are based on recent Board reviews of Program experience and economic conditions. The assumptions and methods used in this valuation are unchanged from those used in the prior valuation as of June 30, 2025, except as noted in this report.

Limited Use We believe the assumptions and methods used in this report for purposes of calculating the adequacy reserve and Program termination liability are reasonable for the purposes of the measurements. The results of this report are dependent upon future experience conforming to the assumptions disclosed in this report. Future actuarial measurements may differ significantly from the current measurements presented in this report due to many factors, including Program experience differing from that anticipated by the economic or demographic assumptions; changes in economic or demographic assumptions; and changes in Program provisions and/or applicable law. Due to the limited scope of our assignment, we did not perform an analysis of the potential range of future measurements. Determinations for purposes other than meeting those requirements referenced above may be significantly different from the results contained in this report. Accordingly, additional determinations may be needed for other purposes.

Reliance In preparing our report we relied, without audit, on information (some oral and some written) supplied by the Board. This information includes, but is not limited to, statutory provisions, contract data, and financial information.

In our examination of this data, we have found it to be reasonably consistent and comparable with data used for other purposes. Since the valuation results are dependent on the integrity of the data supplied, the results can be expected to differ if the underlying data is incomplete or missing. It should be noted that if any data or other information is inaccurate or incomplete, our calculations may need to be revised.

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

This actuarial valuation was prepared and completed by us and those under our direct supervision, and we acknowledge responsibility for the results. To the best of our knowledge, the results are complete and accurate. In our professional opinion, the techniques and assumptions used are reasonable. To the best of our knowledge, there is no benefit provision or related expense to be provided by the Program and/or paid from the Program’s assets for which liabilities or current costs have not been established or otherwise taken into account in the valuation, and there were no known events that were not taken into account in the valuation.

Milliman’s work product was prepared exclusively for the internal business use of the Board, for a specific and limited purpose. It is a complex technical analysis that assumes a high level of knowledge concerning the Program’s operations and uses Program data which Milliman has not audited. To the extent that Milliman’s work is not subject to disclosure under applicable public record laws, Milliman’s work may not be provided to third parties without Milliman’s prior written consent. Milliman does not intend to benefit or create a legal duty to any third-party recipient of its work product. Milliman’s consent to release its work product to any third party may be conditioned on the third party signing a Release, subject to the following exceptions:

(a) The Board may provide a copy of Milliman’s work, in its entirety, to the Program’s professional service advisors who are subject to a duty of confidentiality and who agree to not use Milliman’s work for any purpose other than to benefit the Program.

(b) The Board may provide a copy of Milliman’s work, in its entirety, to other governmental entities, as required by law.

No third-party recipient of Milliman’s work product should rely upon Milliman’s work product. Such recipients should engage qualified professionals for advice appropriate to their own specific needs.

The consultants who worked on this assignment are actuaries. Milliman’s advice is not intended to be a substitute for qualified legal or accounting counsel.

The signing actuaries are independent of the Program sponsor. We are not aware of any relationship that would impair the objectivity of our work.

Certification On the basis of the foregoing, we hereby certify that, to the best of our knowledge and belief, this report is complete and accurate and has been prepared in accordance with generally recognized and accepted actuarial principles and practices which are consistent with Actuarial Standards of Practice, the Code of Professional Conduct and Qualification Standards for Public Statements of Actuarial Opinion of the American Academy of Actuaries. We are members of the American Academy of Actuaries and meet the Qualification Standards to render the actuarial opinion contained herein.

Alan Perry, FSA, CFA, MAAA Matt Larrabee, FSA, EA, MAAA Principal & Consulting Actuary Principal & Consulting Actuary

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Appendices

Appendix A – Actuarial Assumptions and Methods

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

PROGRAM BENEFIT COST ASSUMPTIONS

Program Assumed Benefit Costs For projected Program benefits paid during 2026-2027, actual cost rates were used. Both an annual inflation assumption and a one-time catch-up (or buffer) assumption are applied to 2026-2027 cost rates to develop 2027- 2028 projected rates used in the valuation. In years after that, an annual inflation assumption is applied to the prior year’s projected cost rates. Rates for the first three years, along with the one-time catch up and annual inflation assumptions, are shown in the tables below.

Costs per Hour (per Semester for Dormitory) 2026-2027 2027-2028 2028-2029 University Tuition* $116.67 $151.01 $161.57

University TDF (weighted average) 45.19 46.55 47.94

University Local Fees 37.73 48.79 51.72

College Tuition (Upper Division) 109.12 141.24 150.77

College Local Fees (Upper Division) 12.82 16.59 17.71

College Tuition (Lower Division) 94.69 122.56 130.83

College Local Fees (Lower Division) 11.00 14.24 15.20

Dormitory (per semester) $4,072.73 $4,835.15 $5,125.26

Cost Increase Assumptions One-time Catch-up Increase Annual Inflation

University Tuition 22.00% 6.00%

University TDF (weighted average) 0.00% 3.00%

University Local Fees 22.00% 6.00%

College Tuition (Upper Division) 21.25% 6.75%; capped at 95% of university tuition

College Local Fees (Upper Division) 21.25% 6.75%

College Tuition (Lower Division) 21.25% 6.75%; capped at 85% of university tuition

College Local Fees (Lower Division) 21.25% 6.75%

Dormitory (per semester) 12.00% 6.00%

* Future-year University Tuition amounts do not increase by exactly the percentages shown because the Capital Improvement Trust Fund fee is subject to a separate statutory limit. Under section 1009.24(8)(c), Florida Statutes, the annual increase in this fee is limited to the lesser of 10% of tuition or $2.00.

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

ASSUMED CONTRACT CANCELLATION AND CONTRACT USAGE PATTERNS

Assumed Contract Cancellation Rates Prior to Matriculation Year In 2026, a study to assess recently observed cancellation rates for various contract types over the seven-year period since 2019 was performed. As an outcome of that study, the following contract cancellation rates were assumed in the valuation. The rates vary by contract type, payment option selected, and the amount of time that has passed since contract purchase. The two tables below show the rates that were applied in the valuation.

Contract Cancellation Rates Prior to Matriculation Year - Tuition and Fee Plans Payment Type

Year of contract purchase / matriculation Lump Sum Monthly

Year of purchase* 2.50% – 6.50% 5.00% - 9.00%

1st year after purchase 0.60% 3.00%

2nd year after purchase 0.70% 2.75%

3rd year after purchase 0.50% 2.25%

4th year after purchase 0.50% 1.50%

5th year after purchase 0.45% 1.25%

6th year after purchase 0.45% 1.15%

7th year after purchase 0.40% 1.05%

8th year after purchase 0.40% 0.95%

9th year after purchase 0.40% 0.75%

10th year after purchase 0.20% 0.50%

11th year after purchase 0.20% 0.45%

12th year after purchase 0.20% 0.40%

13th year after purchase 0.20% 0.35%

14th year after purchase 0.20% 0.45%

15th year after purchase 0.20% 0.50%

16th year after purchase 0.20% 0.75%

Year immediately prior to matriculation** 1.00% - 10.0% 2.00% - 15.00%

* In the year of purchase the rates vary by age of beneficiary.

** In the year immediately prior to projected enrollment the rates vary by years since purchase.

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Contract Cancellation Rates Prior to Matriculation Year - Dormitory Plans Payment Type

Year of contract purchase / matriculation Lump Sum Monthly

Year of purchase* 6.00% - 15.00% 9.00% - 17.00%

1st year after purchase 0.50% 5.00%

2nd year after purchase 0.50% 4.00%

3rd year after purchase 0.50% 3.00%

4th year after purchase 0.50% 2.00%

5th year after purchase 0.50% 1.50%

6th year after purchase 0.50% 1.25%

7th year after purchase 0.25% 1.00%

8th year after purchase 0.25% 0.75%

9th year after purchase 0.25% 0.75%

10th year after purchase 0.25% 0.70%

11th year after purchase 0.25% 0.60%

12th year after purchase 0.25% 0.50%

13th year after purchase 0.25% 0.50%

14th year after purchase 0.25% 0.50%

15th year after purchase 0.25% 0.60%

16th year after purchase 0.50% 0.60%

Year immediately prior to matriculation** 1.50% - 15.00% 3.00% - 20.00%

* In the year of purchase the rates vary by age of beneficiary.

** In the year immediately prior to projected enrollment the rates vary by years since purchase.

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Assumed Annual Usage Rates for Contract Benefits During the Benefit Usage Period In 2019, a study to assess recently observed usage rates for various contract types over a five-year observation period was performed. As an outcome of that study, the following contract usage rates were assumed in the valuation. We review benefit usage as part of our annual valuation process that identifies sources of year-to-year change in the adequacy reserve. As such, we anticipate regularly assessing the appropriateness and accuracy of the assumptions. The usage rates in the table below are applied to all remaining unused benefit units for contracts in the specified year of the benefit usage period. The rates are stated as the percentage of remaining unused units that are assumed to be used in the upcoming year of the contract. The usage rate is set to 100% of units still projected available at the conclusion of the ten-year usage period to add a measure of conservatism to the reserve calculations. An illustration of the application of these assumptions for a sample contract is provided later in this appendix after the listing of the cancellation rate assumptions. A study was conducted in 2026 to review experience over the seven years since 2019 and no adjustments to the rates were deemed necessary.

Year 4-Year University

4-Year College Lower Upper

2+2 Plans Lower Upper

2-Year College

1-Year University

Dormitory Plans

1st 18% 34% 2% 28% 1% 23% 34% 57%

2nd 23% 34% 18% 38% 6% 27% 41% 19%

3rd 29% 29% 21% 28% 18% 21% 42% 7%

4th 34% 20% 21% 20% 21% 19% 51% 5%

5th 21% 17% 15% 17% 15% 17% 35% 2%

6th 13% 13% 12% 13% 12% 12% 53% 2%

7th 9% 11% 10% 11% 10% 10% 17% 1%

8th 7% 8% 8% 8% 8% 7% 14% 1%

9th 6% 7% 7% 7% 7% 4% 12% 1%

10th 5% 7% 6% 7% 6% 6% 10% 0%

Thereafter 100%* 100%* 100%* 100%* 100%* 100%* 100%* 100%*

*The 100% usage assumption for the balance of any units still available after the conclusion of the 10-year contractual benefit period is modeled by applying a usage assumption of 10% of remaining unused units each and every month.

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Assumed Monthly Usage Pattern In addition to modeling assumed annual usage levels as noted above, the usage by month is also modeled. For the 1st through 10th years of a contract’s usage period, within a given academic year the usage by month follows the pattern shown in the table below.

Month Tuition Dormitory

July 7.5% 12.5%

August 5.4% 13.9%

September 30.9% 13.3%

October 6.0% 12.6%

November 3.2% 10.2%

December 0.8% 9.5%

January 25.2% 8.9%

February 12.9% 9.4%

March 2.9% 3.3%

April 0.4% 1.5%

May 2.9% 0.9%

June 1.9% 4.0%

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Assumed Annual Cancellation Rates for Contracts During the Benefit Usage Period In 2019, a study to assess recently observed cancellation rates for various contract types over a five-year observation period was performed. As an outcome of that study, the following contract cancellation rates were assumed in the valuation. The cancellation rates in the table below are applied to all remaining unused benefit units for contracts in the specified year of the benefit usage period. The rates are stated as the percentage of remaining unused units that are assumed to be cancelled in the upcoming year of the contract. An illustration of the application of these assumptions for a sample contract is shown on the following page. A study was conducted in 2026 to review experience over the seven years since 2019 and no adjustments to the rates were deemed necessary.

Year 4-Year University

4-Year College Lower Upper

2+2 Plans Lower Upper

2-Year College

1-Year University

Dormitory Plans

1st 2% 4% 4% 2% 3% 4% 5% 6%

2nd 2% 2% 2% 3% 3% 3% 2% 10%

3rd 2% 10% 7% 4% 3% 5% 1% 12%

4th 4% 5% 4% 5% 4% 5% 2% 14%

5th 5% 6% 5% 6% 5% 3% 4% 14%

6th 6% 8% 6% 8% 6% 5% 5% 15%

7th 8% 10% 8% 10% 8% 8% 6% 15%

8th 8% 13% 10% 13% 10% 7% 7% 15%

9th 10% 15% 12% 15% 12% 10% 8% 14%

10th 40% 36% 36% 36% 36% 40% 38% 46%

11th 0% 0% 0% 0% 0% 0% 0% 0%

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Illustration of Usage, Cancellation Assumptions During Benefit Usage Period As noted above, the usage and cancellation assumptions are rates applied to all remaining unused units for contracts in the specified year of the benefit usage period. This table illustrates application of the assumptions to a 4-Year University contract at the start of its usage period with 120 units available. For this contract it is assumed 84% of units (100.95 of 120) will be used and 16% of units (19.05 of 120) will be cancelled. As a measure of conservatism in the adequacy calculations, it is assumed that the 6.01 units projected to remain after 10 years will be used rather than cancelled.

Year

(A) Units Available at Start of Year

(B) Usage Rate

(C) Cancellation

Rate

(D) = (A) x (B) Units Used

(E) = (A) x (C) Units

Cancelled

(A) – (D) – (E) Units Remaining at End of Year 1st 120.00 18% 2% 21.60 2.40 96.00

2nd 96.00 23% 2% 22.08 1.92 72.00

3rd 72.00 29% 2% 20.88 1.44 49.68

4th 49.68 34% 4% 16.89 1.99 30.80

5th 30.80 21% 5% 6.47 1.54 22.79

6th 22.79 13% 6% 2.96 1.37 18.46

7th 18.46 9% 8% 1.66 1.48 15.32

8th 15.32 7% 8% 1.07 1.23 13.02

9th 13.02 6% 10% 0.78 1.30 10.94

10th 10.94 5% 40% 0.55 4.38 6.01

11th 6.01 100%* 0% 6.01 0.00 0.00

Total 100.95 19.05

*Please refer to page 21 for a note on the technical application of the 100% usage assumption in the 11th year.

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

ECONOMIC ASSUMPTIONS

Discount Rates Valuation calculations use a discount rate yield curve provided by the Board as displayed in Exhibit 5. The yield curve is based on U.S. Treasury spot rates increased by an incremental return determined by the Program’s investment consultants to reflect the additional yield from the allocation to corporate bonds in the liability hedge portfolio.

CHANGES IN ASSUMPTIONS AND METHODS SINCE PRIOR VALUATION

Discount rate yield curves: The discount rate yield curve was updated as shown in this report, reflecting changes in capital market conditions between valuation dates.

Certain projected future expenses: The annual budget, lockbox expenses, and investment management fees were updated to reflect current projected costs. These expenses are the “certain projected future expenses” in the reserve calculation.

Pre-matriculation cancellation rates: The assumed cancellation rates for contracts prior to their matriculation date were modified to more closely align with actual cancellation experience over the past 7 years.

Appendix B – Summary of Principal Program Provisions

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified professional

Appendix B – Summary of Principal Program Provisions This summary of the principal Program provisions is intended to only describe the essential features of the Program. All eligibility requirements and benefits shall be determined in strict accordance with governing statutes and Program administrative policies as adopted by the Board.

Eligibility for Contract Purchase Contracts may be purchased year-round, from July 1 through June 30. The Board establishes the prices applicable to contracts purchased during each annual period.

Premium Payment Options Three premium payment options are offered to purchasers:

• Single lump sum

• 84 level monthly payments

• Level monthly payments until the projected enrollment year

Contract Types Available to Purchasers as of 2026-2027 Enrollment Period

• 1 Year Florida University Plan

• 1 Year Dormitory Plan

Contract Cancellation For contracts which are cancelled, the purchaser will receive a refund of the total payments made minus all fees, including late fees owed at the time of cancellation.

Changes in Principal Program Provisions since Prior Valuation The Program transitioned to year-round enrollment, with contract prices established annually for each July 1 through June 30 period.

Appendix C – Summary Contract Data - Matriculation 2026 and Prior

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified

<=2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Totals Tuition Contracts 5,990 5,696 6,417 7,237 8,351 9,682 12,389 16,942 17,076 17,343 16,645 123,768

Total Hours Remaining 246,598 223,897 272,153 321,220 395,593 473,000 592,843 904,986 1,274,690 1,685,273 1,964,377 8,354,629 Avg. Hours per Contract 41.2 39.3 42.4 44.4 47.4 48.9 47.9 53.4 74.6 97.2 118.0 67.5

Fee Contracts 2,809 2,735 3,148 3,471 3,993 4,803 6,563 9,329 10,121 10,878 10,922 68,772 Total Hours Remaining 137,288 120,919 148,528 166,642 205,353 244,999 324,720 498,895 756,820 1,054,514 1,286,837 4,945,516 Avg. Hours per Contract 48.9 44.2 47.2 48.0 51.4 51.0 49.5 53.5 74.8 96.9 117.8 71.9

TDF Contracts 337 391 500 696 1,035 1,622 2,493 4,398 5,812 9,082 10,658 37,024 Total Hours Remaining 16,796 15,649 22,360 31,990 51,139 79,413 118,772 229,182 432,661 883,751 1,257,027 3,138,740 Avg. Hours per Contract 49.8 40.0 44.7 46.0 49.4 49.0 47.6 52.1 74.4 97.3 117.9 84.8

<=2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Totals Tuition Contracts 1,560 1,370 1,728 1,789 1,898 2,018 2,491 2,767 3,008 3,183 2,977 24,789

Total Hours Remaining 74,540 62,780 78,133 85,872 100,060 110,844 126,040 163,814 226,513 299,840 347,907 1,676,343 Avg. Hours per Contract 47.8 45.8 45.2 48.0 52.7 54.9 50.6 59.2 75.3 94.2 116.9 67.6

Fee Contracts 475 477 607 708 822 921 1,157 1,652 1,876 2,146 2,150 12,991 Total Hours Remaining 24,228 23,684 31,725 37,318 44,585 52,126 62,270 95,208 138,229 198,961 250,484 958,819 Avg. Hours per Contract 51.0 49.7 52.3 52.7 54.2 56.6 53.8 57.6 73.7 92.7 116.5 73.8

TDF Contracts 93 92 167 273 382 473 675 1,034 1,415 1,905 2,065 8,574 Total Hours Remaining 3,774 3,151 5,744 9,286 13,646 17,390 25,089 41,915 71,067 111,421 121,345 423,828 Avg. Hours per Contract 40.6 34.3 34.4 34.0 35.7 36.8 37.2 40.5 50.2 58.5 58.8 49.4

<=2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Totals Tuition Contracts 573 610 828 1,000 1,050 1,226 1,653 2,132 2,830 3,911 4,179 19,992

Total Hours Remaining 18,435 17,909 24,114 31,367 36,708 43,319 57,217 78,397 112,080 171,894 243,298 834,738 Avg. Hours per Contract 32.2 29.4 29.1 31.4 35.0 35.3 34.6 36.8 39.6 44.0 58.2 41.8

Fee Contracts 356 414 621 761 867 1,029 1,452 1,891 2,563 3,624 3,931 17,509 Total Hours Remaining 11,715 11,671 18,332 23,738 30,003 35,844 49,602 68,809 101,707 158,752 228,620 738,793 Avg. Hours per Contract 32.9 28.2 29.5 31.2 34.6 34.8 34.2 36.4 39.7 43.8 58.2 42.2

4 Year University Plan, by Matriculation Year

2 + 2 Plan, by Matriculation Year

2 Year Florida College Plan, by Matriculation Year

This work product was prepared solely for the Florida Prepaid College Board for the purposes described herein and may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work. Milliman recommends that third parties be aided by their own actuary or other qualified

Tuition Contracts 4 2 13 24 24 38 41 19 48 57 97 367

Total Hours Remaining 149 83 242 716 880 1,397 1,723 538 2,608 3,023 6,966 18,326 Avg. Hours per Contract 37.3 41.7 18.6 29.8 36.7 36.8 42.0 28.3 54.3 53.0 71.8 49.9

Fee Contracts 2 - 13 21 24 37 39 19 47 56 97 355 Total Hours Remaining 97 - 242 613 880 1,382 1,626 538 2,549 2,968 6,966…