1. SHRM Survey Findings: 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits In collaboration with and commissioned by MassMutual September 18, 2013

2. In collaboration with and commissioned by MassMutual The 2013 Employer Perspectives on Disability Benefits survey, which was commissioned by MassMutual, is a collaboration between the Society for Human Resource Management and MassMutual. The survey was sent to a randomly selected sample of SHRM members from a variety of industries. A response rate of 10% was achieved with 4,402 responses. The main purpose of this research was to gain a better understanding of organizations’ needs and gaps regarding long-term disability and executive benefits. The 2012 data were collected from a sample including small-, medium- and large-staff-size organizations (see slide 17). The findings are divided in the following topics:  Base Group Long-Term Disability Plans  Compensation and Buy-Up Coverage  Supplemental Plan/Individual Disability Income  Carrier Satisfaction/Changes  Executive Group Life Benefits 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 2 Introduction

3. In collaboration with and commissioned by MassMutual The results of each question are reported by the overall sample, and then, where applicable, statistically significant differences by organization staff size, industry and region are included. Only statistically significant differences with a sample size of 25 or more were reported. The results are based on respondents who indicated that they were either “extremely knowledgeable,” “very knowledgeable” or “somewhat knowledgeable” about their organization’s employee benefits plan. The results include respondents from publicly owned for- profit or privately owned for-profit organizations only. 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 3 Introduction (continued) IndustriesOrganization Staff SizeRegion  Accounting/architectural  Computer and electronic products/technology  Energy, gas, oil  Financial services  Health care services  Information services  Law firms and legal services  Manufacturing  Pharmaceutical and medicine  Physician and dental offices  Professional, scientific and technical services  Telecommunications  Utilities  Wholesale and retail trade  Other industries  1 to 99 employees  100 to 499 employees  500 to 2,499 employees  2,500 to 24,999 employees  25,000 or more employees  Midwest  Northeast  South  West

4. In collaboration with and commissioned by MassMutual 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 4 Executive Group Life Benefits

5. In collaboration with and commissioned by MassMutual Do organizations offer a special class of benefits to their executives? Approximately one- third (31%) of organizations reported offering these benefits for executives. Larger staff-size organizations and organizations in the law firms/legal services industry are more likely to offer this special class of benefits.  Among those organizations, 31% provide executives Group Universal Life (GUL) or Group Variable Universal Life (GVUL) as a carve-out benefit from their group term plan. Larger staff-size organizations are more likely to offer executive GUL or GVUL as a carve-out benefit. Have many organizations recently switched their executive group life carriers? Only 19% of organizations reported switching their executive group life carrier in the past three years.  Among those organizations that switched carriers, the top reasons that prompted the carrier change are 1) cost of plan (56%), 2) recommendation of an advisor (38%), 3) lower administrative fees (36%), 4) ease of administration (22%), and 5) additional features available (20%). 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 5 Key Findings in Executive Group Life Benefits

6. In collaboration with and commissioned by MassMutual Is offering executive group life coverage to executives a possible talent management strategy? Currently, only a small proportion of organizations offer executive group life benefits. Larger organizations are more likely to offer these benefit compared with organizations with fewer than 500 employees. Organizations that do provide this coverage may be more successful in attracting and retaining top executives. 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 6 What do these findings mean for HR professionals?

7. In collaboration with and commissioned by MassMutual Do you offer a special class of benefits to executives? 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 7 Note: n = 3,894. Respondents who answered “don’t know” were excluded from this analysis.

8. In collaboration with and commissioned by MassMutual Note: Only statistically significant differences are shown. Do you offer a special class of benefits to executives? 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 8 Larger staff-size organizations are more likely than smaller organizations to offer a special class of benefits to executives. Law firms/legal services are more likely than financial services; wholesale/retail trade; other industries; energy, gas, oil, etc. to offer a special class of benefits for executives. Comparison by organization demographics 100 to 499 employees (27%) 500 to 2,499 employees (33%) 2,500 to 24,999 employees (46%) 25,000 or more employees (55%) > 1 to 99 employees (22%) Law firms and legal services (54%) > Financial services (32%) Wholesale and retail trade (32%) Other industries (31%) Energy, gas, oil (29%) Telecommunications (26%) Professional, scientific and technical services (24%) Computer and electronic products/technology (21%)

9. In collaboration with and commissioned by MassMutual Do you offer executive Group Universal Life (GUL) or Group Variable Universal Life (GVUL) as a carve-out benefit from the organization’s group term plan? 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 9 Note: n = 908. Only respondents whose organizations offer a special class of benefits to executives were asked this question. Respondents who answered “don’t know” were excluded from this analysis.

10. In collaboration with and commissioned by MassMutual Note: Only statistically significant differences are shown. Do you offer executive Group Universal Life (GUL) or Group Variable Universal Life (GVUL) as a carve-out benefit from the organization’s group term plan? 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 10 Larger staff-size organizations are more likely than smaller organizations to offer executive Group Universal Life (GUL) or Group Variable Universal Life (GVUL) as a carve-out benefits from the organization’s group term plan. Comparison by organization demographics 500 to 2,499 employees (36%) 2,500 to 24,999 employees (48%) 25,000 or more employees (61%) > 1 to 99 employees (22%) 100 to 499 employees (21%) 25,000 or more employees (61%) > 500 to 2,499 employees (36%)

11. In collaboration with and commissioned by MassMutual How important are the following benefits for your executives? 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 11 Note: Only respondents whose organizations offer executives GUL or GVUL as a carve-out benefit were asked this question. Respondents who answered “don’t know” were excluded from this analysis. Percentages may not total 100% due to rounding.

12. In collaboration with and commissioned by MassMutual Has your organization switched executive group life carriers in the past three years? 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 12 Note: n = 231. Only respondents whose organizations offer executives GUL or GVUL as a carve-out benefit were asked this question. Respondents who answered “don’t know” were excluded from this analysis.

13. In collaboration with and commissioned by MassMutual What prompted the carrier change? 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 13 Note: n = 45. Only respondents whose organizations offer executives GUL or GVUL as a carve-out benefit and have switched executive group life carriers in the past three years were asked this question. Respondents who answered “don’t know” were excluded from this analysis. Percentages do not total 100% due to multiple response options.

14. In collaboration with and commissioned by MassMutual 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 14 Demographics

15. In collaboration with and commissioned by MassMutual Approximately what percentage of regular, full-time and part- time employees are eligible for employee benefits at your organization? 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 15 Less than 25% 25% to 49% 50% to 59% 60% to 69% 70% to 79% 80% to 89% 90% to 99% 100% Full-time Employees (n = 4,182) 1% 2%4%12%78% Part-time Employees (n = 3,470) 66%3%5%1%2%3%4%16%

16. In collaboration with and commissioned by MassMutual Which of the following is closest to your job title? 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 16 n = 4,394

17. In collaboration with and commissioned by MassMutual Demographics: Organization Staff Size 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 17 n = 4,382

18. In collaboration with and commissioned by MassMutual Demographics: Organization Profit Status 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 18 n = 4,402

19. In collaboration with and commissioned by MassMutual Demographics: Organization Region 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 19 n = 4,106

20. In collaboration with and commissioned by MassMutual Demographics: Organization Industry 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 20 Percentage Manufacturing16% Wholesale and Retail Trade14% Financial services A 10% Professional, Scientific and Technical Services8% Energy, Gas, Oil B 6% Telecommunications6% Accounting / Architectural C 4% Computer and Electronic Products/Technology D 4% Health Care Services E 4% Utilities4% Information Services F 3% Pharmaceutical and Medicine G 2% Law Firms and Legal Services2% Physician and Dental Offices1% Other industries16% n = 4,402 A Includes Banks, Insurance Companies, Securities and Commodities, Other Finance and Insurance Services categories. B Includes Energy Extraction and Refining, Gas and Oil, and Other Oil, Gas, and Energy Extraction and Refining categories. C Includes Accounting, Tax, Payroll Services and Architectural, Engineering categories. D In the survey labeled as Manufacturing: Computer and Electronic Products/Technology. E Includes Hospitals and Other Health Care Services categories. F Includes Publishing, Motion Picture, Broadcasting (except Internet) and Other Information Services categories. G In the survey labeled as Manufacturing: Pharmaceutical and Medicine category.

21. In collaboration with and commissioned by MassMutual U.S.-based operations only66% Multinational operations34% Single-unit organization: An organization in which the location and the organization are one and the same. 26% Multi-unit organization: An organization that has more than one location. 74% Multi-unit headquarters determines HR policies and practices 64% Each work location determines HR policies and practices 4% A combination of both the work location and the multi-unit headquarters determines HR policies and practices 33% Is your organization a single-unit organization or a multi-unit organization? For multi-unit organizations, are HR policies and practices determined by the multi-unit headquarters, by each work location or by both? Does your organization have U.S.- based operations (business units) only, or does it operate multinationally? n = 4,387 n = 4,398 Note: n = 3,410. Percentages do not equal 100% due to rounding. Corporate (companywide)74% Business unit/division15% Facility/location11% n = 3,407 What is the HR department/function for which you responded throughout this survey ? Demographics: Other 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 21

22. In collaboration with and commissioned by MassMutual Response rate = 10% 4,402 HR professional respondents from a randomly selected sample of a variety of industries in SHRM’s membership Margin of error +/- 2% Survey fielded: July 10, 2012 to August 3, 2012 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 22 SHRM Survey Findings: 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits In collaboration with and commissioned by MassMutual Survey Methodology

23. In collaboration with and commissioned by MassMutual 23Disability and Executive Benefits Survey ©SHRM 2012 About MassMutual Founded in 1851, MassMutual is a leading mutual life insurance company that is run for the benefit of its members and participating policyholders. The company has a long history of financial strength and strong performance, and although dividends are not guaranteed, MassMutual has paid dividends to eligible participating policyholders every year since the 1860s. With whole life insurance as its foundation, MassMutual provides products to help meet the financial needs of clients, such as life insurance, disability income insurance, long term care insurance, retirement/401(k) plan services, and annuities. In addition, the company’s strong and growing network of financial professionals helps clients make good financial decisions for the long-term. 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 23

24. In collaboration with and commissioned by MassMutual 24Disability and Executive Benefits Survey ©SHRM 2012 About SHRM The Society for Human Resource Management (SHRM) is the world’s largest association devoted to human resource management. Representing more than 250,000 members in over 140 countries, the Society serves the needs of HR professionals and advances the interests of the HR profession. Founded in 1948, SHRM has more than 575 affiliated chapters within the United States and subsidiary offices in China and India. 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 24

25. In collaboration with and commissioned by MassMutual 25Disability and Executive Benefits Survey ©SHRM 2012 For more survey/poll findings, visit www.shrm.org/surveyswww.shrm.org/surveys For more information about SHRM’s Customized Research Services, visit www.shrm.org/customizedresearch www.shrm.org/customizedresearch Follow us on Twitter @SHRM_Research@SHRM_Research 2013 Employer Perspectives on Disability Benefits—Executive Group Life Benefits ©SHRM 2013 25 About SHRM Research