RE: ENGAGEMENT LETTER

                                                                    EXHIBIT 10.3
                                                                    ------------



                           DLB CAPITAL FUND FNIN, LLC
                                187 DANBURY ROAD
                            WILTON, CONNECTICUT 06897

                                February 1, 2007

Financial Industries Corporation
6500 River Place Boulevard, Building One
Austin, Texas  78730
Attention:  R. Keith Long

         RE:      ENGAGEMENT LETTER

Dear Keith:

         This engagement letter confirms the agreement between DLB Capital Fund
FNIN, LLC (the "CONSULTANT"), and Financial Industries Corporation (the
"COMPANY"), as follows:

         1.       ENGAGEMENT; SERVICES. The Company hereby engages the
Consultant to render management consulting services to the Company during the
term of this engagement letter. The Consultant shall report directly to the
Board of Directors of the Company (the "BOARD"). The management consulting
services to be provided by the Consultant are listed on Appendix A attached
hereto. For the avoidance of any doubt, the Consultant will not act as financial
advisor to the Company in connection with any sale or other change-of-control
transaction.

         The Company will give to a person designated by the Consultant (who
shall be William J. Shea, or in the event of any inability or unwillingness of
Mr. Shea to act in this capacity, a comparably experienced and skilled
professional reasonably acceptable to the Board) (the "DESIGNEE") at least as
much prior notice of the time, place, and subject matter of each regularly
scheduled or special meeting of any board of directors (or committee thereof) of
the Company, or any proposed action by written consent of any board of directors
(or committee thereof) of the Company, as is given to any other director or
committee member; such notices in all cases to include true and complete copies
of all documents and other materials furnished by or on behalf of the Company to
any director (or committee member) in connection with such meeting or consent.
The Designee will be entitled to physically attend any such meeting, or if a
meeting is held by means of an audio- or video-conference, to participate in the
meeting by such means. Notwithstanding anything to the contrary, the Designee
shall not be entitled to attend or listen to any portion of a meeting or receive
any document to the extent it would vitiate privilege.

         2.       COMPENSATION. In consideration of the Consultant's services,
during the term of this engagement letter, the Company will pay the Consultant a
non-refundable cash fee of $36,666 per month, payable semi-monthly (i.e.,
$18,333 each half-month, for an aggregate of $439,996 over the twelve-month term
of this engagement letter) in advance. The full cash fee for the first month of
the term will be due upon the Company's execution of this engagement letter, and


                                      
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Financial Industries Corporation
Investors Life Insurance Company
February 1, 2007
Page 2


subsequent cash fees will be due on the 15th and last day of each calendar
month, beginning on February 28, 2007 and ending on January 14, 2008.

         3.       TERM. This engagement letter and the term of the Consultant's
consulting engagement hereunder will continue in effect through the earlier of
(i) January 31, 2008, (ii) a termination by the Company for Cause, (iii) a
termination by the Consultant by reason of the Company's material breach of this
engagement letter that is not cured within ten (10) days of written notice
thereof to the Company describing in reasonable detail the nature of the alleged
breach, or (iv) a Change of Control Transaction if the Company is obligated to
make the change of control payment pursuant to Section 4(e) of the CEO
Engagement Letter, dated as of the date hereof, between the Company and William
Prouty. The provisions of Sections 4 through 9 hereof will survive expiration or
termination of this engagement letter and the Consultant's engagement hereunder,
as will the Consultant's right to receive any cash fees accrued prior to the
effective date of termination. In the event of a termination by the Consultant
pursuant to clause (iii) above, all cash fees that would have accrued over the
then remaining term of this engagement letter shall immediately be due and
payable. For purposes of this engagement letter, "CHANGE OF CONTROL TRANSACTION"
shall mean any transaction or series of transactions that result in (i) the
acquisition by any person (or persons who would be deemed a person under Section
13d-3 of the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder) of 50% or more of the outstanding shares of
the Company's common stock, or (ii) the sale or other transfer or disposition of
all or substantially all of the consolidated assets of the Company; in each
case, whether structured as a tender or exchange offer, share exchange, merger,
consolidation, business combination, recapitalization, reorganization,
liquidation, dissolution, or similar transaction or series of transactions For
purposes of this engagement letter, except as otherwise expressly noted herein,
"CAUSE" by the Company shall mean if (i) the Consultant or any of its
representatives or agents is convicted of, admits guilt in a written document
filed with a court of competent jurisdiction to or enters a plea of nolo
contendere to, an allegation of fraud, embezzlement, misappropriation, or any
felony; (ii) a material breach of the Consultant's obligations under this
engagement letter which is not cured within ten (10) days of the Company's
written notice thereof to the Consultant describing in reasonable detail the
nature of the alleged breach or (iii) William Prouty is no longer acting as CEO
for by the Company other than as a result of a termination without "Cause" or
resignation by Mr. Prouty for "Good Reason" (each as defined in the CEO
engagement agreement pursuant to which Mr. Prouty acts as CEO of the Company).

         4.       REPRESENTATIONS OF PARTIES. Each of the parties represents and
warrants to each other party that such representing party has all requisite
right, power, and authority to exec