1. COMPARING GUL & IUL GUARANTEES
EXPLORE A NEW ROUTE TO LIFE INSURANCE PROTECTION
COMPARING GUL & IUL GUARANTEES
Policies issued by American General Life Insurance Company. Guarantees backed by the claims-paying ability of the issuing insurance company.
Guaranteed Universal Life (GUL) may be the best choice for some clients. Others may be open to a new form of Index Universal Life (IUL) – one with a protection-focus and strong guarantees.
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

2. FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.
GUL
IUL
WHY DO YOU SELL GUL?
It’s Permanent
You want long-term coverage, or you’d be selling term
It’s Guaranteed
Guaranteed premium and death benefit up to a specified age
It’s Easy
Easy to illustrate, easy to explain
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

3. Value+ Protector IUL @5.6%
Secure Lifetime GUL3
Value+ Protector
Initial Death Benefit
Premium x 20 years
Guaranteed to Age (w/CGA)
Age Policy Runs Out
Cash Year 20
Death Age 101
Death Age 121
$1.0M
$14K/yr
100
$16K $0
$1.0M
$14K/yr 88
It Doesn’t!2
$362K
$1.8M
$6.3M
LET’S COMPARE THE TWO OPTIONS
100 88
For a 50-year-old male, preferred non-tobacco, 20-pay, same annual premium, same DB1
LET’S LOOK AT THIS A LITTLE CLOSER
1 This is a hypothetical example for illustrative purposes only. These numbers are based on an illustration dated 05/01/18, are subject to change and do not contemplate fees and charges for additional features or riders. The VPP is illustrated using the Cap Rate Account at 5.6%.
2 At 5.6%, the policy matures at age 121 for $6.3M
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

4. CONTINUATION GUARANTEE CONTINUATION GUARANTEE
Secure Lifetime GUL3
MARKET IMPACT ON THE TWO OPTIONS
Secure Lifetime GUL3
Value+ Protector IUL
CONTINUATION GUARANTEE
Age 50
100
ACCUMULATION ACCOUNT
Year 20 $0
$400
CONTINUATION GUARANTEE
Age 50
100
ACCUMULATION ACCOUNT
Year 20 $0
$400
Less CGA and much more potential for credited interest
CGA and very little accumulation potential
IMPACT OF THE MARKET
With a Guarantee Age of 100 on the GUL:
In a 0% market, the policy lapses at 101
In a 5.6% market, the policy lapses at 101
With the same premium and DB in the IUL
In a 0% market, the policy lapses at 89
In a 5.6% market, the policy matures at 121 for $6.3M1
MARKET PERFORMANCE HAS NO IMPACT ON THE POLICY
MARKET PERFORMANCE CAN HAVE A STRONG IMPACT ON THE POLICY2
1 This policy example uses an index crediting strategy with a 9% cap. The AG49 rules limit this illustration to 5.6% (on 05/01/18).
2 In an IUL policy, clients are not invested in the market or an index. Clients can earn interest based, in part, on the performance of an underlying index. Clients cannot invest in an index directly.
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

5. WHAT DOES IT MEAN TO HAVE A 0% MARKET?
Value+ Protector (VPP) ties its crediting rate to an index, like the S&P500®.
For VPP to credit 0% in an index accumulation account in any year, the underlying index would have to experience a negative return for that year.
That means, if the index returns -10% for the year, 0% is credited to the account for that year.1
In our example, there are 38 years from policy issue for our 50-year-old until the VPP’s ‘Guarantee to Age’ of 88.
Therefore…
The S&P500® would have to generate negative returns for ALL 38 years before the ‘Guarantee to Age’ of 88 could become a reality.
1 Assumes an index crediting period of one year, point-to-point.
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

6. The S&P500® has returned 29 negative years (32% of the time)1
HOW OFTEN HAS THE S&P500®
RETURNED A NEGATIVE?
SINCE 1927 (90 YEARS),
The S&P500® has returned 29 negative years (32% of the time)1
BUT WHAT ABOUT CONSECUTIVE NEGATIVE YEARS?
In the recorded history of the S&P500®
THERE HAS NEVER BEEN A 30+ YEAR PERIOD OF NEGATIVE RESULTS
4 years, 1929 – 1932
OKAY, BUT WHAT’S THE WORST 30-YEAR PERIOD?
Worst total return over a 30-year consecutive period:
+2.8%
1 This analysis was performed using S&P data from 1927 through 2017 (90 years). The S&P Composite Index started in By 1926, it tracked 90 stocks, growing to 500 stocks in The total return value excludes dividends. Of course, past performance is not a predictor of the future.
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

7. HOW BAD WOULD IT HAVE TO BE TO GET A
30+ YEAR NEGATIVE RETURN
S&P500® HISTORICAL RETURNS FOR 90 YEARS (1928 – 2017)1
THE DOTCOM BUBBLE BURST
THE FINANCIAL CRISIS / GREAT RECESSION
THE GREAT DEPRESSION
Let’s look at the most recent 90 years of the S&P500®
1 This analysis was performed using S&P data from 1927 through 2017 (90 years). The S&P Composite Index started in By 1926, it tracked 90 stocks, growing to 500 stocks in The total return value excludes dividends. Of course, past performance is not a predictor of the future.
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

8. …the “Longest, Greatest, Bubble Burst, Recession, Depression” ever!
HOW BAD WOULD IT HAVE TO BE TO GET A
30+ YEAR NEGATIVE RETURN
S&P500® HISTORICAL RETURNS FOR 90 YEARS (1928 – 2017)1
…the “Longest, Greatest, Bubble Burst, Recession, Depression” ever!
THE DOTCOM BUBBLE BURST
THE FINANCIAL CRISIS / GREAT RECESSION
THE GREAT DEPRESSION
In order for our 50-year-old’s VPP policy to only last to the ‘Guaranteed to Age’ of 88, the next 30+ years would need to be…
1 This analysis was performed using S&P data from 1927 through 2017 (90 years). The S&P Composite Index started in By 1926, it tracked 90 stocks, growing to 500 stocks in The total return value excludes dividends. Of course, past performance is not a predictor of the future.
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

9. IS “GUARANTEED” TOO CONSERVATIVE?
While the market’s history cannot be used to predict the future, a 30+ year negative return in the S&P500® seems unlikely
If 0% for 30+ years is unprecedented and our current illustrated rate is not quite conservative enough for your GUL clients
WHAT CONSERVATIVE RATE SHOULD YOU ILLUSTRATE VPP FOR YOUR GUL CLIENTS?
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

10. To start, let’s look at the last 90 years of the S&P500®
S&P500® Historical Returns for 90 Years (1928 – 2017)
HISTORICALLY, WHAT COULD BE CONSIDERED A CONSERVATIVE ILLUSTRATION RATE?
To start, let’s look at the last 90 years of the S&P500®
This analysis was performed using S&P data from 1927 through 2017 (90 years). The S&P Composite Index started in By 1926, it tracked 90 stocks, growing to 500 stocks in The total return value excludes dividends. Of course, past performance is not a predictor of the future.
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

11. 1928 – 1957:
WORST 30 YEARS
S&P500® Historical Returns for 90 Years (1928 – 2017)
HISTORICALLY, WHAT COULD BE CONSIDERED A CONSERVATIVE ILLUSTRATION RATE?
Now, let’s locate the worst 30-year period in that history
This analysis was performed using S&P data from 1927 through 2017 (90 years). The S&P Composite Index started in By 1926, it tracked 90 stocks, growing to 500 stocks in The total return value excludes dividends. Of course, past performance is not a predictor of the future.
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

12. 1928 – 1957:
WORST 30 YEARS
S&P500® Historical Returns for 90 Years (1928 – 2017)
WORST S&P500® 30-Year Period (1928 – 1957)
-50%
-30%
-10%
10%
30%
50%
1928
1933
1938
1943
1948
1953
HISTORICALLY, WHAT COULD BE CONSIDERED A CONSERVATIVE ILLUSTRATION RATE?
Now, let’s locate the worst 30-year period in that history
This analysis was performed using S&P data from 1927 through 2017 (90 years). The S&P Composite Index started in By 1926, it tracked 90 stocks, growing to 500 stocks in The total return value excludes dividends. Of course, past performance is not a predictor of the future.
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

13. FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.
WORST S&P500® 30-Year Period (1928 – 1957)
-50%
-30%
-10%
10%
30%
50%
1928
1933
1938
1943
1948
1953
HISTORICALLY, WHAT COULD BE CONSIDERED A CONSERVATIVE ILLUSTRATION RATE?
And calculate the total return for the WORST 30-year period 1928 – 1957
Total Return: +2.8%
This analysis was performed using S&P data from 1927 through 2017 (90 years). The S&P Composite Index started in By 1926, it tracked 90 stocks, growing to 500 stocks in The total return value excludes dividends. Of course, past performance is not a predictor of the future.
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

14. What if we used THIS rate in the VPP?
WORST S&P500® 30-Year Period (1928 – 1957)
9% Cap on the WORST S&P500® 30-Year Period (1928 – 1957)
HISTORICALLY, WHAT COULD BE CONSIDERED A CONSERVATIVE ILLUSTRATION RATE?
-50%
-30%
-10%
10%
30%
50%
1928
1933
1938
1943
1948
1953
Next, let’s run this period through a hypothetical 9% Cap Index strategy, sharing in the positive years up to 9% and NONE of the negative years
What if we used THIS rate in the VPP?
Total Return: +2.8%
Interest Credited to Index Account: +4.5%
This analysis was performed using S&P data from 1927 through 2017 (90 years). The S&P Composite Index started in By 1926, it tracked 90 stocks, growing to 500 stocks in The total return value excludes dividends. Of course, past performance is not a predictor of the future.
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

15. FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.
Let’s compare GUL3 to
Now, we’ll illustrate Value+ Protector at the 90-year historical worst case scenario of 4.5%1
VPP
@ 5.6%
GUL3
Initial Death Benefit
$1.0M
Premium x 20 years
$14K/yr
Guaranteed to Age (w/CGA)
100 88
Age Policy Runs Out
It Doesn’t!2
Cash Year 20
$16K
$362K
Death Age 101 $0
$1.8M
Death Age 121
$6.3M
For a 50-year-old male, preferred non-tobacco, 20-pay, same annual premium, same DB1
1 This is a hypothetical example for illustrative purposes only. These numbers are based on an illustration dated 05/01/18, are subject to change and do not contemplate fees and charges for additional features or riders. The VPP is illustrated using the Cap Rate Account at 5.6% and 4.5%.
2 At 5.6%, the policy matures at age 121 for $6.3M
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

16. FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.
Let’s compare GUL3 to
Now, we’ll illustrate Value+ Protector at the 90-year historical worst case scenario of 4.5%1
VPP
@ 5.6%
GUL3
Initial Death Benefit
$1.0M
Premium x 20 years
$14K/yr
$13K/yr
Guaranteed to Age (w/CGA)
100 88
Age Policy Runs Out
112
It Doesn’t!2
Cash Year 20
$16K
$311K
$362K
Death Age 101 $0
$1.8M
Death Age 121
$6.3M
For a 50-year-old male, preferred non-tobacco, 20-pay, same annual premium, same DB1
1 This is a hypothetical example for illustrative purposes only. These numbers are based on an illustration dated 05/01/18, are subject to change and do not contemplate fees and charges for additional features or riders. The VPP is illustrated using the Cap Rate Account at 5.6% and 4.5%.
2 At 5.6%, the policy matures at age 121 for $6.3M
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

17. FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.
Let’s compare GUL3 to
Now, we’ll illustrate Value+ Protector at the 90-year historical worst case scenario of 4.5%1
VPP
@ 4.5%
VPP
@ 5.6%
GUL3
Initial Death Benefit
$1.0M
Premium x 20 years
$14K/yr
Guaranteed to Age (w/CGA)
100 88
Age Policy Runs Out
112
It Doesn’t!2
Cash Year 20
$16K
$321K
$362K
Death Age 101 $0
$1.8M
Death Age 121
$6.3M
100
112
VPP Outlasts GUL3 in the Historical Worst Case Scenario with significant Cash Value in Year 20
For a 50-year-old male, preferred non-tobacco, 20-pay, same annual premium, same DB1
1 This is a hypothetical example for illustrative purposes only. These numbers are based on an illustration dated 05/01/18, are subject to change and do not contemplate fees and charges for additional features or riders. The VPP is illustrated using the Cap Rate Account at 5.6% and 4.5%.
2 At 5.6%, the policy matures at age 121 for $6.3M
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

18. FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.
WHY
WOULD
YOU SELL VPP?
GUL
VPP
@4.5%
It’s Permanent
It has Guarantees
and may be conservative enough for my client
Commissionable
Premium
$10,220
$8,505
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

19. FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.
IT’S AS EASY AS
1, 2, 3
For your next GUL case:
Run three illustrations
The GUL
The VPP at the current crediting rate, using the same premium and death benefit
The same VPP using the 4.5% rate
After showing the GUL to your client:
Show the current rate VPP illustration, including the guarantees
Then show the “non-guaranteed values” in the 4.5% illustration and explain that this reflects the worst case scenario, historically
Then let your client choose:
The GUL?
The VPP?
Perhaps, a combination of both?
Secure Lifetime GUL3
Value+
Protector
IUL at
4.5%
Value+
Protector
IUL at
5.6%
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.

20. FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.
THANK YOU!
To learn more about bridging from GUL to Value+ Protector IUL visit aig.com/IUL
Policies issued by: American General Life Insurance Company (AGL), Policy Form Numbers 16760, ICC , 15442, ICC ; Rider Form Numbers 07620, 13600, , ICC , 13601, ICC , 14002, ICC , 15271, ICC , 15272, ICC , 15273, ICC , 15600, ICC , 15972, 15990, ICC , 15992, ICC , 15997, ICC , 16110, ICC , 82001, 82012, and Issuing company AGL is responsible for financial obligations of insurance products and is a member of American International Group, Inc. (AIG). AGL does not solicit business in the state of New York. Products may not be available in all states and product features may vary by state. Guarantees are backed by the claims-paying ability of the issuing insurance company.
©AIG All rights reserved AGLC111678
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.