Asset Based Long-Term Care Producers Choice offers 3 life insurance based long term care products: Lincoln Financial Group – MoneyGuard II, Genworth – Total Living Coverage (TLC), and OneAmerica – Asset Care.

The Big Question If over 70% of people age 65* and older will require LTC, why do less than 10% of consumers own LTC insurance?** The first thing that we want to take into consideration is the need for solutions. Most consumers are not protecting themselves from the costs of LTC expenses for a number of reasons. They may believe that they are healthy and will not incur LTC costs, they are going to self-insure, or they know they may need coverage but are not willing to commit to paying more insurance premiums. Many clients feel that they are already over insured and that they do not get benefits from their current insurance policies. *Source: U.S. General Accounting Office, Long Term Care: Aging Baby Boomer Generation will increase financial burden on state and federal budgets,” March 21, 2002. **Source: U.S. Department of Health and Human Services, National Clearinghouse for Long-Term Care Information, www.longtermcare.gov, September 2008.

Objections to Traditional LTC Insurance Traditional LTC Insurance is often considered very expensive Traditional LTC Insurance does not have guaranteed premiums Client may never use the LTC Insurance

Carriers and Products Producers Choice offers 3 life insurance based long term care products: Lincoln Financial Group – MoneyGuard II, Genworth – Total Living Coverage (TLC), and OneAmerica – Asset Care.

LFG – MoneyGuard II “Live, Quit, or Die” Someone will always benefit from a MoneyGuard policy, hence the “Live, Quit, or Die” slogan. If the client would like to “quit,” an 80% return of premium is available. Or, if they die, a death benefit will pay out to the client’s beneficiaries. Finally, if they live, the client can usually spend between 4 and 5 times their single premium on long term care. Quit Die Live 65 year old male - $100,000 deposit - Couples Discount

This is the summary of benefits that will most likely be used in a client presentation (explain line-by-line).

All of the benefits with MoneyGuard II are fully guaranteed All of the benefits with MoneyGuard II are fully guaranteed. Even though MoneyGuard II is primarily a long term care product, the IRR on death benefit is also respectable at life expectancy (1.8% tax free).

A Smarter Alternative to Self Insuring Sales idea: use one quarter of the money you have set aside to self-insure against long term care as a deposit for MoneyGuard, and you will immediately free up the remaining assets to use as you please.

Underwriting Simplified Issue 45 minute Personal History Interview Only 2 classes: male and female Incorporates smoker and non-smoker Incorporates preferred best through table 4 Compensation Policy issue is more transactional than most life insurance products because the simplified underwriting requires only a 45 minute personal history interview. Additionally, there are only 2 risk classes, male and female, which incorporate both smokers and non-smokers, and all risk classes from preferred best through table 4 non-tobacco. Smokers and clients in the table 2-4 range can benefit from this. 6%, or $6,000 in example

Nationwide – CareMatters Total Long-Term Care Benefit Limit $389,159 “Live, quit, or die” also holds true with Genworth – TLC. The predominant difference between TLC and MoneyGuard II is that TLC is fully underwritten, and clients in great health can benefit from a 15% preferred discount. Initial Specified Amount $129,720 or or ROP Benefit $100,000 year 6 Quit Die Live 65 year old male - $100,000 deposit - Couples Discount

Nationwide – CareMatters: Benefit Overview Single Premium - $100,000 Long Term Care Benefits – Initial Monthly: $5,405 Initial Annual: $64,860 Initial Total: $389,159 Inflation Option – N/A Minimum Long-Term Care Benefit Duration – 6 years Deductible Period – 90 days Specified Amount - $129,720 Guaranteed Minimum Death Benefit - $25,944 Return of Premium: $100,000 beginning year 6

Key Differences Benefits are indemnity based – no submission of receipts 90 day elimination period Return of premium follows vesting schedule: 85% year 1, 88% year 2, 91% year 3, 94% year 4, 97% year 5, 100% year 6 20% guaranteed minimum death benefit if Initial Specified Amount is exhausted 1, 5, and 10-pay options only 3% simple and 5% compound inflation options

Underwriting Simplified Issue 45 minute Tele-Interview Compensation 5.5% or $5,500 in example As previously mentioned, Genworth – TLC is fully underwritten, but the silver lining in the clouds is that healthy clients can qualify for a preferred underwriting class and a 15% preferred discount.

OneAmerica – Asset Care Survivorship with Lifetime Continuation of Benefits For a husband and wife who both desire protection from long term care expenditures, OneAmerica – Asset Care typically offers greater benefits than purchasing 2 separate MoneyGuard II or TLC policies. Another proprietary feature of Asset Care is that the Continuation of Benefits Rider can provide coverage for life, whereas MoneyGuard II and TLC only offer finite benefit periods.

Asset Care I features a Return of Premium benefit, however money used to pay for the Continuation of Benefits rider is not available for a return of premium. Even so, the product features cash accumulation that rivals other fixed savings vehicles (4% guaranteed interest rate).

Underwriting Simplified Issue 45 minute Personal History Interview (similar to MoneyGuard II) May require full underwriting if: Client has not seen a doctor within past 12 months There is a history of major medical concerns The net amount at risk is greater than $250,000 Compensation Underwriting is generally simplified and simply requires a 30 minute Personal History Interview. In certain situations, Asset Care can move to full underwriting (see above for criteria). Asset Care I: 8%, or $12,000 in example

Lincoln Financial Group Summary   Lincoln Financial Group Nationwide OneAmerica MoneyGuard II CareMatters Asset Care Funding Non-Qualified AC I - NQ 1-pay 1-10 pay 1, 5, and 10-pay AC II - Annuity 1035 AC III - IRA Transfer AC IV - 10-20 pay, Life-pay Underwriting Simplified Depends Compensation 6% 5.5% AC I - 8%  When to Use Individual Life  Individual Life Joint policy/Survivorship Couples Discount, Average or below average health, Smokers Indemnity Style Benefits Variety of funding options Lifetime COB