1. Your Asset-Based LTC Opportunity
Welcome and greeting
Presented by: Kevin Fisher, Regional Marketing Director
For company and recruiting use only. Not for public distribution.
4/17/2015

2. First, some housekeeping..
As personal situations change, so will an individual’s life insurance needs. Care should be taken to ensure this product is suitable for long-term life insurance needs. Any associated costs should be considered before making a purchase. Life insurance has fees and charges that include costs of insurance which vary based on gender, health, and age, and has additional charge for riders. Guarantees are subject to the claims paying ability of the issuing insurance company.
A fixed annuity is a long-term, tax-deferred insurance contract designed to create a fixed stream of income through a process called annuitization while providing a fixed rate of return. Withdrawals from fixed annuities may be subject to surrender charges and ordinary income taxes. If a withdrawal is made prior to age 59 ½, an additional 10% tax penalty may apply. A fixed annuity contains guarantees and protections that are subject to the issuing insurance company’s ability to pay for them.
Before we begin, please take a moment to read the following disclosures.
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.

3. All guaranteed are subject to the claims paying ability of State Life.
Riders are optional and carry an additional cost. The long-term advantage of an optional benefit will vary with the terms of the benefit option and the length of time the product is owned. As a result, in some circumstances, the cost of an option may exceed the actual benefit paid under the option.
Please note that the replacement of an existing annuity must not be made unless all factors are weighed and it is documented as suitable for the client.
Products underwritten and issued by The State Life Insurance Company, (State Life), Indianapolis, Indiana. Policy Forms: Asset-Care: L301, SA31 and R501 (or state variation); Annuity Care and Annuity Care II: SA34, SA35, R508; Legacy Care: SA32, R502 and R503; ImmediateCare: SA33 . Product and riders may not be available in all states or may vary by state.
All guaranteed are subject to the claims paying ability of State Life.
Before we begin, please take a moment to read the following disclosures.
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.

4. Average Cost of Care $87,600 per year for private room in 2014
The Average Cost of Long-Term Care in the United States in 2014: • $223/day or $6,691/month for a semi-private room in a nursing home • $204/day or $7,300/month for a private room in a nursing home • $3,500/month for care in an assisted living facility (one-bedroom unit) • $20/hour for a home health aide •
Source: Genworth Financial, April 22, 2015
$87,600 per year for private room in 2014
- If medical inflation 3.5%
In 10 yrs with inflation = $123,568 per year
In 20 yrs with inflation = $174,305 per year
Trends that could impact costs of Long-term Care:
Baby Boomers – number of people needing care at same time
Medical Technology – Life expectancy increasing - costs more
Family Dynamics – Who is providing care now?
Government – What programs will be available? Who will qualify?
The average cost of care in the United States is considerable, and with inflation, expectations are it will continue to increase. In addition, there are several other factors that could impact the cost of care, including the aging Baby Boomer population, advances in medical technology, government programs and family dynamics.
For company and recruiting use only. Not for public distribution.

5. Estimated cost in 20 yrs based on averages:
-- $ 174,305 per year @ 2.2 yrs for men = $ 383,471
-- $ 174,305 per year @ 3.7 yrs for women = $ 644,928
-- $ 174,305 per year @ 8 yrs for Alzheimer’s= $1,394,440
According to The National Long-Term Care Clearinghouse:
About 70% of individuals over age 65 will require at least some type of long-term care service during their lifetime
Over 40% will need care in a nursing home for some period of time
Women need care for longer (on avg. 3.7 years) than do men (on avg. 2.2 years)
Source: U.S. Department Source: U.S. Department of Health and Human Services, 4/12/12
The chances of needing long-term care is something your clients should not ignore. According to the federal government, around 70% of individuals over the age of 65 will require some type of LTC. 40% of those individuals will require care in a nursing home, and the risk is greater of for women than men.

6. Two Questions Every Financial Professional Should ask their clients:
1. You may never need care, but if you did, how will that affect your family?
Spouse?
Adult children?
Family Dynamics?
Finances?
2. And…if you did need care, how will you pay for it?
Two simple questions you can ask your clients are: “You may never need care, but if you did, how will that affect your family?” and “ If you did need care, how will you pay for it?’
Simple phrases like this can help properly frame the conversation.
Government?
LTC insurance?
Self fund?
For company and recruiting use only. Not for public distribution.

7. Concept of Asset-based LTC with Life Insurance *(example)
Cash Value
Aggressive
Moderate
Death Benefit
Long-term Care
$125k
Conservative
$250k
The concept of asset-based long-term care lies in its name. Instead of using income to provide long-term care insurance benefits, our approach reallocates existing assets to pay a single premium and provide LTC benefits.
Of course annual pay options are also available, but most clients prefer the ability to repurpose an asset already ear marked for a health care need, leverage that premium into LTC benefits, and avoid “another bill” to pay.
Typical portfolio assets:
Aggressive-assets positioned for significant growth with the acceptance of the risk of loss of principal
Moderate-assets positioned for some growth with the acceptance of some downside risk
Conservative--assets positioned for conservation of principal—often with guarantees
Lifetime LTC
(Unlimited)

8. Portfolio Protection!
Not only is this portfolio protection for the client, it’s portfolio protection for an advisor!
If an advisor has an aging clientele, and over the next years their clients begin to withdraw hundreds of thousands of dollars out of accounts that are being managed….
…what happens to their business?
For company and recruiting use only. Not for public distribution.
2/28/09

9. Care Solutions Portfolio
Asset Care® Whole life insurance with LTC benefits
Asset Care I (Single Premium) Cash or cash equivalents
Asset Care II (Single Premium) Existing nonqualified annuities via 1035 exchange
Asset Care III (Single Premium) Qualified money via direct rollover
Asset Care IV (Annual Premium)10pay up to 20pay or whole life pay
Annuity Care ® Single premium annuity with LTC benefits
Annuity Care Cash, qualified money, existing nonqualified annuities exchange
Annuity Care II Cash or existing nonqualified annuities via 1035 exchange
Indexed Annuity Care Cash, qualified money, existing non-qualified annuities – 1035 exchange
Legacy Care ® Single premium deferred annuity
Designed for the retiree market
Immediate Care ® Immediate Lifetime annuity (SPIA)
Designed to help fund LTC or provide retirement income
The State Life Insurance Company offers one of the most robust and complete asset-based long-term care insurance portfolios. Let’s look at a brief overview of the Care Solutions portfolio and how each solution is funded.

10. Asset-Care I example: Joint contract 64 & 64
Life Insurance policy
Continuation of Benefits Rider is optional
$250,000
50 months
= $500,000
$125,000
$250,000
50 months or
LIFETIME 1
$5,000
Per person
$3,000 / year
Premiums guaranteed!
Highlights:
Ages 40-80
Single or patented joint life option
Guaranteed return of premium on 50 month option
Guaranteed cash value growth
Optional lifetime coverage available with premium guaranteed to never increase
Funding: Cash, CDs, savings, brokerage accounts, 1035 Life Cash Value
Asset-Care is our whole life insurance product with LTC benefits. It provides access to the death benefit for qualifying LTC expenses, and an optional extension of benefits should your clients fear an extended care need.
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.

11. Concept and Acceleration of Death Benefit Options
Life Insurance policy
Continuation of Benefits Rider is optional
50 months
50 months
Lifetime
2% of death benefit
33 months
33 months
Lifetime
3% of death benefit
Asset-Care is our whole life insurance product with LTC benefits. It provides access to the death benefit for qualifying LTC expenses, and an optional extension of benefits should your clients fear an extended care need.
25 months
25 months
Lifetime
4% of death benefit
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.

12. Asset-Care III example: Qualified money
$117,000
$125,000
Asset Care IRA
$250,000
$250,000
50 months
= $500,000
$8,000
50 months or
LIFETIME
Annual Taxable withdrawal 1
50 mos
$5,000
Per person
$133,000
Additional life insurance with LTC benefits
Asset-Care is our whole life insurance product with LTC benefits. It provides access to the death benefit for qualifying LTC expenses, and an optional extension of benefits should your clients fear an extended care need.
Highlights:
Ages: 59½ -80
Patented joint life option or single life
Guaranteed return of premium on 50 month option
Guaranteed cash value growth
Optional lifetime coverage available with premium
guaranteed to never increase
Funding: 401k, IRA, 403b, qualified monies
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.

13. Asset-Care IV example: Annual pay option
Life Insurance policy
Continuation of Benefits Rider is optional
$100,000
$1,000
Annual premium
25 months
= $200,000
$100,000
25 months or
LIFETIME 1
$4,000
Per person
$2,113 / year
Premiums guaranteed!
Highlights:
Ages (rider available at 40 with exception)
Single or patented joint life option
Guaranteed cash value growth
10 Pay up to 20 Pay or Whole Life pay. Paid annual, semi-annual, quarterly, or monthly
Optional lifetime coverage available with premium guaranteed to never increase
Funding: Cash, Pension Income, Annuitization Income, Earned Income, RMD
Asset-Care is our whole life insurance product with LTC benefits. It provides access to the death benefit for qualifying LTC expenses, and an optional extension of benefits should your clients fear an extended care need.
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.

14. Single Premium Annuity Long-term care $100k $200k $300k Lifetime
Concept of Asset-based LTC annuity
*(example)
Single Premium
Annuity
Aggressive
Moderate
Long-term care
$100k
Conservative
$200k
$300k
The concept of asset-based long-term care lies in its name. Instead of using income to provide long-term care insurance benefits, our approach reallocates existing assets to pay a single premium and provide LTC benefits.
Of course annual pay options are also available, but most clients prefer the ability to repurpose an asset already ear marked for a health care need, leverage that premium into LTC benefits, and avoid “another bill” to pay.
Typical portfolio assets:
Aggressive-assets positioned for significant growth with the acceptance of the risk of loss of principal
Moderate-assets positioned for some growth with the acceptance of some downside risk
Conservative--assets positioned for conservation of principal—often with guarantees
Lifetime
(Unlimited)
For company and recruiting use only. Not for public distribution.

15. Care Solutions Portfolio
Asset Care® Whole life insurance with LTC benefits
Asset Care I (Single Premium) Cash or cash equivalents
Asset Care II (Single Premium) Existing nonqualified annuities via 1035 exchange
Asset Care III (Single Premium) Qualified money via direct rollover
Asset Care IV (Annual Premium)10pay up to 20pay or whole life pay
Annuity Care ® Single premium annuity with LTC benefits
Annuity Care Cash, qualified money, existing nonqualified annuities exchange
Annuity Care II Cash or existing nonqualified annuities via 1035 exchange
Indexed Annuity Care Cash, qualified money, existing non-qualified annuities – 1035 exchange
Legacy Care ® Single premium deferred annuity
Designed for the retiree market
Immediate Care ® Immediate Lifetime annuity (SPIA)
Designed to help fund LTC or provide retirement income
The State Life Insurance Company offers one of the most robust and complete asset-based long-term care insurance portfolios. Let’s look at a brief overview of the Care Solutions portfolio and how each solution is funded.

16. Pension Protection Act
Existing annuity
(funded with after-tax dollars)
Pension Protection Act
$50,000 basis +
$100,000 gain =
$150,000 cash value
Taxes owed on gain
which is withdrawn first
Withdrawal
1035 Exchange
Long-term care expenses
Annuity-based asset-based LTC products are also available and are eligible for the tax advantages of the Pension Protection Act. We offer two approaches: Annuity Care and Annuity Care II.
$150,000
Withdrawal
HIPAA qualified PPA
eligible annuity
Beginning January 1,2010, income tax-free as a reduction of cost basis
Numeric examples are hypothetical and were used for educational purposes only.
For company and recruiting use only. Not for public distribution.
Not FDIC Insured-May Lose Value-Not Bank Guaranteed –For company and recruiting use only  - Not for Public Distribution

17. Annuity Care 81 Female $ 125,000 in Non-Qualified Annuity
Doesn’t need for income
Minimum 3% rate guarantee
Annuity Care
$125,000
COB rider is optional
Annuity
36 Months
36 Months
Lifetime
$102,500
$22,500
$36,000 per year, tax-free benefits – for Lifetime!
With Annuity Care, the base annuity and continuation of benefits are purchased separately. The continuation of benefits is optional.
Highlights:
ages 50-85
Withdrawals for LTC expenses are federal income tax-free (non-qualified money only)
Funding sources: cash equivalents, non-qualified annuities via 1035 exchange, qualified money
Optional lifetime coverage available with premium guaranteed to never increase
Base annuity only – NO teleinterview
Continuation of Benefits rider requires teleinterview
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.

18. 24 Months (single life) 30 months (joint life)
Annuity Care II
COB rider is INCLUDED
Annuity
36 months
2.5 x
24 Months (single life) 30 months (joint life)
72 months
4 x
108 months
5.5 x
Monthly LTC charges
Highlights:
ages 40-80
Withdrawals for LTC expenses are federal income tax-free
Internal withdrawals to pay for Continuation Of Benefits rider are federal income tax-free
Benefits paid from Continuation Of Benefits rider are federal income tax-free
Funding sources: cash equivalents and non-qualified annuities via 1035 exchange
Requires teleinterview only
With Annuity Care II, The continuation of benefits is built-in. Annuity Care II cannot be purchased without the continuation of benefits.
Rather than paying for the continuation of benefits out-of-pocket as with Annuity Care, Annuity Care II’s continuation of benefits is funded by a monthly charge deducted from the annuity values.
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.

19. 24 months, single 30 months, joint
Indexed Annuity Care
COB rider is optional
24 months, single
30 months, joint 2x
Fixed-indexed Annuity
24 months, single 30 months, joint
48 months, single
60 months, joint 3x
LIFETIME
Highlights:
Ages 40-85
Fixed-indexed annuity allows for upside growth potential by linking to the S&P 500®, with protection from down-side risk
Withdrawals for LTC expenses are federal income tax-free (non-qualified money only)
Benefits paid from Continuation Of Benefits rider are federal income tax-free
Funding sources: cash equivalents, non-qualified annuities via 1035 exchange, qualified money
Optional lifetime coverage available with premium guaranteed to never increase
Base annuity only – NO teleinterview
Continuation of Benefits rider requires teleinterview only
With Annuity Care, the base annuity and continuation of benefits are purchased separately. The continuation of benefits is optional.
For company and recruiting use only. Not for public distribution.
For company and recruiting use only. Not for public distribution.

20. Let’s get started Contact {Marketing Org. information}
Contact the Sales Desk at:
Thank you for attending. Get started by contacting the Sales Desk, or your local wholesaling team.
For company and recruiting use only. Not for public distribution.