Principal Lifetime Income Solutions II Variable AnnuitySM Training

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Agenda - Product features - GMWB riders - Target Income Protector Why variable annuities? Profile of a variable annuity client Principal Lifetime Income Solutions II Variable Annuity - Product features - GMWB riders - Target Income Protector - Flexible Income Protector For financial professional use only. Not for distribution to the public.

Why variable annuities? Provides a way to save tax-deferred for retirement Provides a long-term savings plan Growth potential Provides guaranteed lifetime income Provides a guaranteed death benefit to beneficiaries Death benefit passes outside probate Guarantees are based on the claims-paying ability of Principal Life Insurance Company. For financial professional use only. Not for distribution to the public.

A typical Principal Lifetime Income Solutions II client is … Planning for retirement Interested in an investment that provides guaranteed income for life Someone with a long-term investment horizon Interested in tax-deferred savings Concerned about the impact of market volatility on their retirement income Looking for protection for their family For financial professional use only. Not for distribution to the public.

Product features Features Premiums Details Premiums $2,000 qualified $5,000 nonqualified $500 minimum additional premium $2 million max without home office approval Issue ages 45-80 Fees and expenses M&E: 1.25% Administration charge: 0.15% Annual fee: less of $30 or 2% of accumulated value; waived if accumulated value is $30,000 or more Surrender charges Seven-year surrender charge scale by deposit 6-6-6-5-4-3-2 Surrender charges waived at death or annuitization For financial professional use only. Not for distribution to the public.

Product features Features Free withdrawal amount Greatest of: Details Free withdrawal amount Greatest of: 10% premium payments Contract earnings Required minimum distribution (RMD) Waiver of surrender charge rider Waives surrender charges due to death, disability or nursing home* Death benefit Accumulated value Premium payments, less any withdrawals The highest seventh-anniversary (7, 14, 21 etc.) accumulated value plus any premium payments and less any withdrawals made after that anniversary Guaranteed minimum withdrawal benefit riders Two options Must elect one at issue May terminate after five years *Automatic issue to age 80. There is a one-year waiting period before the rider can be exercised. State variations may apply. For financial professional use only. Not for distribution to the public.

Not available with this rider GMWB rider features Rider features Target Income Protector Flexible Income Protector Charge For current rider charges for new issues, please refer to the prospectus and applicable GMWB Charges and Percentages prospectus supplement Bonus For current bonus information for new issues, please refer to the prospectus and applicable GMWB Charges and Percentages prospectus supplement Not available with this rider Step-up Automatic annual step-up each contract anniversary until the later of age 80 or 10 years after issue For financial professional use only. Not for distribution to the public.

GMWB rider features Withdrawal benefit payment Investment options Target Income Protector Flexible Income Protector Withdrawal benefit payment Single/joint life options available Withdrawal benefit payment is based on withdrawal benefit base and age at first withdrawal Withdrawal benefit payment is based on withdrawal benefit base, age at first withdrawal and how long client defers taking withdrawals Investment options May allocate between any of the investment options available with each rider Diversified Growth Volatility Control Diversified Balanced Volatility Control Diversified Income Fidelity VIP Government Money Market Diversified Growth Diversified Balanced Diversified Growth Managed Volatility Diversified Balanced Managed Volatility For financial professional use only. Not for distribution to the public.

DCA Plus program Six-month or 12-month option Provides a guaranteed return over the six or 12 month period All funds must be transferred out over the given time period Each monthly transfer amount is equal to the DCA Account value divided by the number of months remaining in the account (note: transfers always happen on the 28th of the month) Only available for new premiums and can’t be used in conjunction with Automatic Portfolio Rebalancing If money is added to an existing DCA account, the premium will receive the rate in effect when the money is added and will be transferred out over the monthly transfers remaining in the current account Clients are allowed one six-month and one 12-month DCA account at a given time For financial professional use only. Not for distribution to the public.

Target Income Protector rider may be right for…   Clients who are looking for guaranteed income for life Clients who are interested in receiving a bonus if no withdrawals are taken Clients who are willing to pay more for a guaranteed minimum withdrawal benefit rider to receive higher withdrawal benefit payment percentages For financial professional use only. Not for distribution to the public.

Target Income Protector rider Offers a deferral bonus Offers fewer investment options than the Flexible Income Protector rider Includes volatility control funds Help limit exposure to market volatility by reducing exposure to equity asset classes May deliver lower investment returns Volatility control funds may cost more

Target Income Protector rider Withdrawal benefit payment percentage - tiered single/joint life percentages (joint life percentage is lower). Bonus – automatically applied to the guarantee each year during the bonus period until a withdrawal is taken Not included in the contract’s accumulated value Once a withdrawal is taken, no longer eligible for the bonus Step-up: annual automatic Current bonus, withdrawal benefit payment percentages and rider fees can be found in the GMWB Charges and Percentages prospectus supplement.   . For financial professional use only. Not for distribution to the public.

Flexible Income Protector rider may be right for…. Clients who are interested in guaranteed income for life Clients who are concerned about fees and are looking for a lower cost guaranteed minimum withdrawal benefit rider Clients who aren’t looking for a deferral bonus For financial professional use only. Not for distribution to the public.

Flexible Income Protector rider Offers more investment options than the Target Income Protector rider Does not include volatility control funds Lower cost than the Target Income Protector rider Withdrawal percentage based on age and how long client defers taking withdrawals

Flexible Income Protector rider Withdrawal benefit payment percentage - tiered single/joint life percentages (joint life percentage is lower) Bonus – Not available with this rider Step-up: annual automatic Current withdrawal benefit payment percentages and rider fees can be found in the GMWB Charges and Percentages prospectus supplement.   . For financial professional use only. Not for distribution to the public.

Annual Step-up Available on both Target Income Protector and Flexible Income Protector riders Automatic annual step-up Withdrawal benefit base automatically resets to match any growth in the accumulated value Available each year to the later of age 80 or 10 years after contract date Rider charge resets to current charge at step-up If charges increase, client may opt out of future step-ups to keep current fee   . For financial professional use only. Not for distribution to the public.

For Life Withdrawal Benefit Target Income Protector rider - withdrawal benefit payment is based on withdrawal benefit base and age at time of first withdrawal Flexible Income Protector rider – withdrawal benefit payment is based on withdrawal benefit base, age at time of first withdrawal and how long client defers taking withdrawals Joint life percentage is lower because the payout period can be considerably longer on a joint life election. Based on younger covered life at time of first withdrawal. Client does not need to elect single or joint life until the time at first withdrawal Withdrawals prior to age 59 ½ may be subject to 10% IRS penalty tax For financial professional use only. Not for distribution to the public.

For Life Withdrawal Benefit The GMWB Withdrawal Benefit Payment Percentages are provided in a monthly prospectus supplement Withdrawals greater than the For Life withdrawal payment percentage will be treated as excess withdrawals All withdrawals prior to the contract anniversary following the oldest owner’s age 59 ½ are treated as excess withdrawals when calculating the For Life withdrawal benefit payment Withdrawal percentages are locked in at the time of first withdrawal and do not change for the life of the contract For financial professional use only. Not for distribution to the public.

Unique Features for Joint Life Not available to non natural owners Spouse must be either joint owner and/or primary beneficiary Spouse must be legally married Prior to withdrawals, eligible spouse changes can be made due to divorce or marriage (no changes after withdrawals begin) Only one spousal continuation is allowed For financial professional use only. Not for distribution to the public.

What happens at death At death of the owner (or first owner if joint owners) A non-spouse beneficiary can take the death benefit Spousal Continuation If spouse is primary beneficiary, the spouse can continue the rider If withdrawals started prior to death If single life elected, the rider terminates If joint life elected, For Life payments continue as long as the spouse is the covered life Note: For Life will remain at the same Joint Life withdrawal benefit payment percentage set at the time of first withdrawal If withdrawals did NOT start prior to death Spouse can continue the For Life with the Single Life option For financial professional use only. Not for distribution to the public.

RMD Programs and Termination Required Minimum Distributions (RMD) Program - Withdrawals taken to satisfy RMDs will not be treated as excess withdrawals as long as the RMD Program for GMWB riders guidelines are followed Terminations - The Target Income Protector and Flexible Income Protector riders may be terminated after five contract years - These riders will “automatically” terminate with a change of ownership - These riders will terminate if the contract is terminated For financial professional use only. Not for distribution to the public.

Policy rider descriptions are not intended to cover all restrictions, conditions or limitations. Refer to rider for full details. Riders are subject to state availability. Principal Lifetime Income Solutions II Variable AnnuitySM is issued by Principal Life Insurance Company and distributed through Principal Securities, Inc., 800-247-1737, member SIPC and/or independent broker/dealers. Securities sold by a Principal Securities Registered Representative are offered through Principal Securities. Principal Life and Principal Securities are members of the Principal Financial Group®, Des Moines, IA 50392. No part of this presentation may be reproduced or used in any form or by any means, electronic or mechanical, including photocopying or recording, or by any information storage and retrieval system, without prior written permission from the Principal Financial Group®. Not FDIC or NCUA Insured May lose value · Not a deposit · No bank or credit union guarantee Not insured by any Federal government agency For financial professional use only. Not for distribution to the public. RF2320| © 2017 Principal Financial Services, Inc. | t17021607pe | 02/2017