1. United Kingdom Payout Annuities Arshil Jamal
SVP, Chief Actuary / Capital Management
Angela Jonkhans
Vice President, Capital Management

2. Capital Market Solutions
UK Payout Annuities
Market Overview
Mortality
Capital Market Solutions

3. Market has grown by 9% per year on average from 2003 to 2008
U.K. Payout Annuities – Total Market Premium
9% CAGR
Market has grown by 9% per year on average from 2003 to 2008
Source: MARS, 2008

4. Canada Life sales have grown at 19% per annum on average since 2003
Canada Life U.K. Annuity Sales
19% CAGR
Canada Life sales have grown at 19% per annum on average since 2003
Source: MARS, 2008

5. Canada Life is the fourth largest provider of new annuities in the UK
UK New Sales – Annuities to all Distribution Channels
New Sales
Canada Life is the fourth largest provider of new annuities in the UK
Source: MARS, 2008

6. UK Payout Annuity Market - 2008
Just under half of annuities are written by the company that managed / administered the pensions accumulation policy
Source: MARS, 2008

7. UK New Sales External Annuities to all Channels - 2008
Excluding internal conventional rollover business, Canada Life is the second largest provider of new annuities in the UK
Source: MARS, 2008

8. UK Payout Annuity Assets

9. UK Payout Annuity Asset Mix – Q1 2009
Total Assets £16.6 billion

10. Combined Payout Asset & Liability Cash Flows
Projected Annuity Asset & Liability Cash flows
Combined Payout Asset & Liability Cash Flows
Asset portfolio is constructed to provide as close as possible cash flow match to the expected liabilities

11. Capital Market Solutions
UK Payout Annuities
Market Overview
Mortality
Capital Market Solutions

12. Reserving Assumption 90.6% Reserving Assumption 84%
Canada Life Mortality Experience
Males
Females
Average Experience 100%
Average Experience 99%
Reserving Assumption 90.6%
Reserving Assumption 84%
For a seller of annuities, a higher ratio is better than a lower ratio
The margin between actual experience and reserving assumption is approximately 10% for males and 15% for females.
Footnotes:
All numbers show ratio of actual deaths to expected deaths, with expected deaths calculated as 100% of the current valuation tables i.e. PNMA00 with medium cohort improvements (plus floor) for males and PNFA00 with 75% medium cohort improvements (plus floor) for females.
2004 and 2005 is Canada Life business only, includes Resolution and Equitable business.
Valuation assumption is weighted average across all 3 blocks.

13. CL UK Valuation/Pricing
Life Expectancies
CL UK Valuation/Pricing
Female
Male
No Improvements
With Improvements
Canada Life assumption for life expectancies is approximately 6 years higher than the latest published population mortality
Approximately half of this allowance is for future improvements in mortality
Other half reflects the lighter mortality for annuitants compared to the general population

14. These now form a much lower proportion of the total deaths
Mortality by Cause of Death
Males
Females
Mortality by major cause for males – England & Wales, (Source: ONS)
Mortality by major cause for females – England & Wales, (Source: ONS)
Purple - Infectious diseases
Green - Respiratory diseases
Red Cancers
Blue - Circulatory diseases
Purple - Infectious diseases
Green - Respiratory diseases
Red Cancers
Blue - Circulatory diseases
Mortality rates have declined over the last 40 years driven by a decrease in deaths from circulatory diseases
These now form a much lower proportion of the total deaths
Deaths from other causes have been much more stable over that period.

15. Capital Market Solutions
UK Payout Annuities
Market Overview
Mortality
Capital Market Solutions

19. Questions