1. TMK1536 0612 For Agent training purposes only, not for sales presentation 8 vs. 18

2. TMK1536 0612 For Agent training purposes only, not for sales presentation Best DCN% by Branch Branch ManagerBranch DCN% Steve Harris8 Ron Tadle7 Nick Slagle7

3. TMK1536 0612 For Agent training purposes only, not for sales presentation Best Persistency% by Branch Branch ManagerBranch Persistency% Byron Schreiber92 Tony Difilippo94 Jill Wilmeth94 Aaron Snider98 Nick Slagle98

4. TMK1536 0612 For Agent training purposes only, not for sales presentation Definitions D ecline: Poor field underwriting (1%) C ancellation: Customer cancels or underwriting requirements not met (3%) N ot-Taken: Customer returns policy during free-look period or payment not received (6%)

5. TMK1536 0612 For Agent training purposes only, not for sales presentation How is DCN calculated? Declines Cancels Not Takens Submitted Premium

6. TMK1536 0612 For Agent training purposes only, not for sales presentation Definitions Persistency: Premium issued and paid four months or longer, divided by total issued business based on policy effective date

7. TMK1536 0612 For Agent training purposes only, not for sales presentation How does Quality impact pay & retention? Chargebacks Months Premium PaidChargeback % 0-2 months100% 3 months90% 4 months80% 5 months70% 6 months60% Months Premium PaidChargeback % 7 months50% 8 months40% 9 months30% 10 months20% 11 months10%

8. TMK1536 0612 For Agent training purposes only, not for sales presentation How does Quality impact pay & retention? Chargebacks Direct pay submit advance commissions DCNBB/AnnualSection 125All Other Modes 0 – 1370%50%0% 14 – 1755%40%0% 18+40%30%0% Direct Pay Submit Advance may be reduced based on the Agent’s DCN

9. TMK1536 0612 For Agent training purposes only, not for sales presentation How does Quality impact pay & retention? Chargebacks Direct pay submit advance commissions Gross Submit Production Pay – (DCN + Lapses) Agent Gross Submit 4 Wk Agent Gross Submit Lapses in first 2 months DCNNet Submit 4 Wk Avg. Net Submit Prod. Pay % Prod. Pay DCN Mult. Prod. Pay $1,500 $0 $1,500$1,500.0015%$225.001.00$225.00 $2,000$1,750($400)$0$1,600$1,550.0017%$263.501.00$263.50 $2,800$2,100($500)($300)$2,000$1,700.0021%$357.001.00$357.00 $1,500$1,950($150)($600)$750$1,462.5019%$277.881.00$277.88 $800$1,775($200)($100)$500$1,212.5017%$206.131.00$206.13 $2,000$1,775($100)($50)$1,850$1,275.0017%$216.751.00$216.75 $3,500$1,950$0($600)$1,900$1,500.0019%$285.001.00$285.00

10. TMK1536 0612 For Agent training purposes only, not for sales presentation How does Quality impact pay & retention? Chargebacks Direct pay submit advance commissions Gross Submit Production Pay – (DCN + Lapses) DCN: Bonus multiplier first 7 months % DCNMULTIPLIER 0.001.20 0.011.19 0.021.18 0.031.16 0.041.14 0.051.12 % DCNMULTIPLIER 0.061.10 0.071.08 0.081.06 0.091.04 0.101.02 0.111.00 % DCNMULTIPLIER 0.120.96 0.130.92 0.140.88 0.150.83 0.160.78 0.170.72 % DCNMULTIPLIER 0.180.66 0.190.60 0.200.54 0.21 +0.00 Production Pay DCN Multipliers

11. TMK1536 0612 For Agent training purposes only, not for sales presentation How does Quality impact pay & retention? Chargebacks Direct pay submit advance commissions Gross Submit Production Pay – (DCN + Lapses) DCN: Bonus multiplier first 7 months Persistency: Bonus multiplier month 8 and beyone Production Pay Persistency Multipliers % PERMULTIPLIER 1.001.32 0.991.32 0.981.30 0.971.28 0.961.26 0.951.24 0.941.22 0.931.20 0.921.18 0.911.16 % PERMULTIPLIER 0.901.14 0.891.12 0.881.11 0.871.10 0.861.09 0.851.08 0.841.07 0.831.06 0.821.04 0.811.02 % PERMULTIPLIER 0.801.00 0.790.95 0.780.90 0.770.85 0.760.80 0.740.75 0.740.70 0.730.65 0.720.60 0.710.55 % PERMULTIPLIER 0.700.50 0.690.45 0.680.40 0.670.35 0.660.30 0.650.25 ≤0.640.00

12. TMK1536 0612 For Agent training purposes only, not for sales presentation How does Quality impact pay & retention? Last but certainly not least… Renewals

13. TMK1536 0612 For Agent training purposes only, not for sales presentation So how does that translate to dollars?

14. TMK1536 0612 For Agent training purposes only, not for sales presentation What does an 8 vs. 18 DCN mean to an Agent in his first seven months with a $1,400 per week average?

15. TMK1536 0612 For Agent training purposes only, not for sales presentation Take Home Pay Individual 8 DCN Agent takes home 49% more Worksite 8 DCN Agent takes home 47% more

16. TMK1536 0612 For Agent training purposes only, not for sales presentation Individual8 DCN18 DCN Production$39,200 Direct Pay %70%40% Direct Pay$27,440$19,040 Worksite8 DCN18 DCN Production$39,200 Direct Pay %50%30% Direct Pay$19,600$14,000 $8,400 More Direct Pay $5,600 More Direct Pay Agent Direct Pay

17. TMK1536 0612 For Agent training purposes only, not for sales presentation DCN %Gross Submit DCNNet Submit Prod. Pay % Prod. Pay DCN Mult. Prod. Pay 8$1,400$112$1,28815%$1931.06%$204 18$1,400$252$1,14815%$1720.66%$113 Production Pay Net Submit & DCN Multiplier

18. TMK1536 0612 For Agent training purposes only, not for sales presentation DCNDirect PayProd PayTotal Individual 8$27,440$5,712$33,152 Individual 18$19,040$3,164$22,204 Take Home Pay$10,948 Worksite 8$19,600$5,712$25,312 Worksite 18$14,000$3,164$17,164 Take Home Pay$8,148 Take Home Pay

19. TMK1536 0612 For Agent training purposes only, not for sales presentation Take Home Pay Individual 8 DCN Agent takes home 49% more Worksite 8 DCN Agent takes home 47% more

20. TMK1536 0612 For Agent training purposes only, not for sales presentation So when is a good time to train on Quality?

21. TMK1536 0612 For Agent training purposes only, not for sales presentation Individual Business A-250 Application

22. TMK1536 0612 For Agent training purposes only, not for sales presentation Quality Before the Sale: Classroom Training

23. TMK1536 0612 For Agent training purposes only, not for sales presentation Review the key points in the Agent’s Instruction Guide: Then save it to the desktop of the Agent’s computer Agent’s Instruction Guide

24. TMK1536 0612 For Agent training purposes only, not for sales presentation Automatic Decline Conditions Terminal Illness Lou Gehrig’s Disease or Amyotrophic Lateral Sclerosis (ALS) HIV / AIDS or Positive Test to Antibodies for AIDS virus Alzheimer’s Disease or Senile Dementia Confined to a hospital or nursing facility Use of illegal drugs within a two-year period Confined to jail Applicants with the following conditions will be automatically declined:

25. TMK1536 0612 For Agent training purposes only, not for sales presentation When is the Agent required to get an Oral Swab? Underwriting Requirements Chart

26. TMK1536 0612 For Agent training purposes only, not for sales presentation If the proposed insured does not fall within the standard weight limits shown on the chart, the proposed insured will be rated. Build Charts

27. TMK1536 0612 For Agent training purposes only, not for sales presentation Lists conditions and “general” guidelines Medical History Guide

28. TMK1536 0612 For Agent training purposes only, not for sales presentation Do not submit an application for standard issue for the following conditions. An ALX will be considered if the underwriters determine the proposed insured is eligible for coverage. Heart / Circulatory / Blood Disorders Diabetes and Related Disorders Cancers Misc. Medical Disorders Disability ALX Only

29. TMK1536 0612 For Agent training purposes only, not for sales presentation Quality During the Presentation: Setting Correct Expectations

30. TMK1536 0612 For Agent training purposes only, not for sales presentation Open your eyes

31. TMK1536 0612 For Agent training purposes only, not for sales presentation What questions can you ask an applicant in normal conversation to determine if you should present ALX?

32. TMK1536 0612 For Agent training purposes only, not for sales presentation Questions Have you ever had cancer? Have you ever had diabetes? Have you ever had heart problems or high blood pressure? What medications are you taking? Are you receiving disability income? How’s your driving record?

33. TMK1536 0612 For Agent training purposes only, not for sales presentation “Great news! We have a policy specifically designed for people with your health conditions.”

34. TMK1536 0612 For Agent training purposes only, not for sales presentation On cases with that appear to be medically questionable, the best thing to do is submit the application on a trial basis. Apps over $1 million Collect no payment or app fee Does not count for submit for commissions or production pay Does not count against DCN if declined or not taken by customer Trial Applications

35. TMK1536 0612 For Agent training purposes only, not for sales presentation So why don’t Agents use Trial applications?

36. TMK1536 0612 For Agent training purposes only, not for sales presentation When does an individual policy go into effect?

37. TMK1536 0612 For Agent training purposes only, not for sales presentation Sets expectations QAC Call Medical Records Closing Script

38. TMK1536 0612 For Agent training purposes only, not for sales presentation Quality After the Submit

39. TMK1536 0612 For Agent training purposes only, not for sales presentation Worksite

40. TMK1536 0612 For Agent training purposes only, not for sales presentation Checklist Found In ‘Steps to Success’ Relationship With The Bookkeeper

41. TMK1536 0612 For Agent training purposes only, not for sales presentation Follow-up, who is responsible, date completed Worksite Case Checklist

42. TMK1536 0612 For Agent training purposes only, not for sales presentation This is what it looks like in Qlikview when a worksite case is not taken Impact of Not-Takens

43. TMK1536 0612 For Agent training purposes only, not for sales presentation What would it take to lower our company DCN from a 12 to an 8?

44. TMK1536 0612 For Agent training purposes only, not for sales presentation 2011 Results DCN Premium $2,497,243 Branches 63 DCN Premium Per Branch $39,638 Weeks 52 Premium DCN’d Per Wk Per Branch $762

45. TMK1536 0612 For Agent training purposes only, not for sales presentation 48 issued policies per branch per week

46. TMK1536 0612 For Agent training purposes only, not for sales presentation DCN Detail Report Example

47. TMK1536 0612 For Agent training purposes only, not for sales presentation CODs QAC Calls Oral Swab At any given time, there are 2,500 applications in some sort of pending status Top 3 Causes of Pended Applications

48. TMK1536 0612 For Agent training purposes only, not for sales presentation Renewals $66,976 5% Renewals $3,348

49. TMK1536 0612 For Agent training purposes only, not for sales presentation Renewals $59,696 5% Renewals $2,984