CAILBA Information Series What’s New With Income Annuities in Canada ? CANNEX: CAILBA Information Series What’s New With Income Annuities in Canada ? November 29, 2012

The next 25 years ! CANNEX: Aging / healthier population More people ages 55 to 64 than 15 to 24 5800 > 100 / 250k > 90 By 2020 almost half the households in Canada will have one member age 55 + Shift from accumulation to “deccumulation”

CANNEX: “A wide range of risks can threaten a secure and stable retirement for American retirees. Inflation can drive down the purchasing power of retirees’ accumulated assets. Low rates of return and high administrative fees on financial assets can reduce the flow of income that can be derived from retiree wealth. Unpredictable life events – such as a medical emergency or an unexpected need for long term care – can quickly deplete retirement savings. Lastly, and perhaps most importantly, extended longevity can pose a risk to retirees who did not anticipate living so long and find themselves with insufficient assets” ….. (U.S.) Council of Economic Advisers / Office of the President, February 2012

CANNEX: Retirement Income Planning 101: Holistic approach “Product allocation” … Milevsky Government Benefits Employer Benefits Personal Resources

CANNEX: Annuities 101: “An insurance contract that, in return for a payment, provides payments in the future”

CANNEX: Annuities 101: “An insurance contract that, in return for a payment, provides payments in the future that can be guaranteed for the lifetime of the annuitant(s) ”

CANNEX: Annuities 101: Mortality Investment performance Expenses

Mortality credits / risk pooling CANNEX: Annuities 101: Mortality credits / risk pooling 5 Ladies …… Milevsky

CANNEX: …but only an insurance company can manufacture a mortality pool.

CANNEX: Annuities 101: “An insurance contract that, in return for a payment, provides payments in the future that can be guaranteed for the lifetime of the annuitant(s) ”

CANNEX: Annuities 101: “A low risk alternative to other more volatile investments and provides longevity insurance”

CANNEX: What’s new with annuities in Canada ?: Increased public and advisor awareness of the benefits CLHIA stats re: 2011 CANNEX stats re: last 12 months New features: CR, liquidity, DIA

CANNEX: What’s new at CANNEX ?:

CANNEX: Participating life companies provide CANNEX with their proprietary income annuity calculation algorithms which are maintained on a central server at CANNEX and “crunched” simultaneously to provide real time quotes and / or surveys

CANNEX: What’s new at CANNEX ?: CR Illustrations Tools / videos RIF fund type Interest accrual / non-prescribed annuities Buy now

CANNEX: alex@cannex.com