for producer use only Term Insurance M25260_0510

Transcription

1 for producer use oly Term Isurace M25260_0510

2 May 2010, Mutual of Omaha Isurace Compay, publisher. All rights reserved. No part of this publicatio may be reproduced, stored i a retrieval system or trasmitted i ay form or by ay meas, electroic, mechaical, photocopy, recordig or otherwise, without the prior writte coset of the publisher. This publicatio is Proprietary Material i accordace with the terms of the Producer s Cotract ad must be retured upo the earlier of: Request by Mutual of Omaha Isurace Compay or The date of cotract cacellatio

3 TERM isurace Table of Cotets Overview UNIT 1--Itroductio to Term Isurace UNIT 2--Term Life Aswers Portfolio UNIT 3--Riders...11 UNIT 4--Term Life Epress ad Term Life Complete...15 UNIT 5--Applicatio UNIT 6--Uderwritig...53 UNIT 7--Sales ad Marketig Ideas UNIT 8--Term Isurace Comprehesive Eam...65

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5 TERM isurace OVERVIEW OBJECTIVE Upo completio of this sessio, you will be able to: Idetify ad eplai the beefits ad features of the term isurace products M25260_0510 1

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7 UNIT 1 itroductio to TERM INSURANCE INTRODUCTION Term isurace is pure protectio. If the Isured dies durig the life of the cotract, the death beefit is paid. At the ed of the cotract term, the policy lapses uless it is reewed. Term isurace provides your cliets the advatage of a lower iitial cash outlay tha permaet isurace. However, term isurace is oly a temporary solutio; term plas evetually epire. Whe you cosider term vs permaet, you must cosider a variety of factors: The eed to be met The duratio of the eed ad The cliet s ability to pay As a geeral rule of thumb, if the eed is for a short period of time, such as a mortgage or a busiess or persoal debt, the term isurace may be the better alterative. However, if the eed for isurace eteds for the whole life, the permaet isurace offers several sigificat advatages. The secod factor to cosider is the cliet s ability to pay. I situatios where the fiacial resposibilities of a idividual or busiess eceed the ability to pay, term isurace, either aloe or with permaet isurace, allows buyers to protect agaist a potetial loss at a price they ca afford to pay. It allows cliets to ow a substatial amout of protectio at a affordable cost. I additio, cliets ca covert to permaet isurace at a later date without evidece of isurability. College studets, youg families, workig sigles ad busiesses are just a few markets that ca beefit from term isurace. The appropriate solutio, of course, depeds o the idividual or busiess eeds which must be determied through careful aalysis. ADVANTAGES FOR AGENTS Term products offer you several advatages which iclude: They are dooropeers They are cliet-buildig products They work especially well i the eeds-sellig areas of family icome protectio ad busiess isurace M25260_0510 3

8 They give you a lower priced, competitive term product you eed for today s ecoomic eviromet They ca meet the eeds of prospects who have log-term eeds with limited fuds ad set the stage for a coversio at some poit i the future They ca also fud temporary isurace eeds TERM PRODUCTS Curretly, Uited of Omaha offers the followig term products, which we will be focusig o throughout this module: Term Life Aswers 10 } Term Life Aswers 15 Term Life Aswers 20 Term Life Aswers 30 Term Life Products Term Life Epress ad Term Life Complete -- Isurace to help protect homes, families ad lifestyles. SUMMARY Term isurace is basic, affordable protectio that ca be essetial to your ciet s overall fiacial plaig. M25260_0510 4

9 UNIT 2 TERM LIFE ANSWERS PORTFOLIO INTRODUCTION PRODUCT OVERVIEW This uit will cover the Term Life Aswers Portfolio. The Term Life Aswers Portfolio cosists of four products: Term Life Aswers 10 Term Life Aswers 15 Term Life Aswers 20 Term Life Aswers 30 Term Life Aswers 10, 15, 20 ad 30 are traditioal term products i the sese that they provide guarateed level premiums for 10, 15, 20 ad 30 years, respectively. Let s cover the beefits ad features of the Term Life Aswers Portfolio. A overview of the product features for each of these plas is provided o the chart below. PRODUCT COMPARISON CHART Features Term Life Aswers 10 Term Life Aswers 15 Term Life Aswers 20 Term Life Aswers 30 Geeral Level term isurace Level term isurace Level term isurace Level term isurace for 10-year period* for 15-year period* for 20-year period* for 30-year period* Coversio Yes; Before age 75 or Before age 75 Before age 75 or two years after policy issue, whichever is later Re-etry Yes; for the first 15 policy years Yes; allowed Yes; allowed Yes; allowed Yes; allowed through age 75 through age 70 through age 65 through age 50 Bads/Miimum $100,000-$249,999 $100,000-$249,999 $100,000-$249,999 Policy Size $250,000-$499,999 $250,000-$499,999 $250,000-$499,999 $500,000-$999,999 $500,000-$999,999 $500,000+$999,999 $1 millio+ $1 millio+ $1 millio+ Billig Methods Riders Aual/Semiaual/Quarterly Mothly BSP Accelerated Beefit Accidetal Death Beefit Depedet Childre s Other Isured Waiver of Premium *At the ed of the guaratee period, curret ad guarateed premiums icrease aually based upo the attaied age. **I Washigto, re-etry is allowed through age 70 o 10-year term product ad through age 65 o the 15-year term product, through age 60 for the 20-year term product ad through age 50 for the 30-year term product. M25260_0510 5

10 BANDS The Term Life Portfolio has the followig bads: $100,000-$249,999 $250,000-$499,999 $500,000-$999,999 $1 millio ad over ISSUE AGES Term Life Aswers issue ages, for all risk classes, are show below: Term Life Aswers Product Issue Ages Term Life (18-70 i Washigto) Term Life (18-65 i Washigto) Term Life (18-60 i Washigto) Term Life * RISK CLASSES The Term Life Aswers portfolio offers si risk classes: Preferred Plus NT Preferred NT Stadard Plus NT Stadard Plus tobacco Stadard NT Stadard tobacco Notobacco rates are available if the proposed Isured has ot used tobacco for the past 12 moths. For Preferred Plus ad Preferred rates, the Isured must ot have used tobacco i the last five years. It is possible to be rated substadard ad still qualify for the otobacco premium. It is ot possible to be rated substadard ad qualify for Stadard Plus, Preferred or Preferred Plus otobacco rates. *For male tobacco risk classes, the maimum issue age is 47. M25260_0510 6

11 SUBSTANDARD Term Life policies have the ability to be issued to applicats who have ISSUES a health impairmet. They may be issued to a Isured who is rated up through Table 16 with a face amout of $100,000 or above. Substadard etra premiums are 25% of the stadard premium for each substadard factor. PREMIUM MODES/ FEE/FACTORS The aual policy fee is $65. The Term Life Aswers portfolio ca be issued with the followig modes: Mode Factor Aual 100% Semiaual 152% Quarterly 27.5% BSP Mothly 1 8.9% PREMIUMS Term Life Aswers has both curret ad guarateed premiums. The premiums for each of the Term Life products are as follows. Product Term Life 10 Term Life 15 Term Life 20 Term Life 30 Premiums 10-year guaratee Curret premiums are level ad guarateed for the first 10 policy years. After the 10th policy year, premiums icrease aually o a curret ad guarateed basis. 15-year guaratee Curret premiums are level ad guarateed for the first 15 policy years. After the 15th policy year, premiums icrease aually o a curret ad guarateed basis. 20-year guaratee Curret premiums are level ad guarateed for the first 20 policy years. After the 20th policy year, premiums icrease aually o a curret ad guarateed basis. 30-year guaratee Premiums are level ad guarateed for the first 30 policy years. After the 30th policy year, premiums icrease aually o a guarateed basis. NOTE: Curret premiums ca ever eceed the guarateed premiums. PREMIUM REFUND AT DEATH Ay premium paid beyod the policy moth i which the Isured dies will be refuded ad paid to the beeficiary as part of the death beefit. This refud will ot iclude premiums waived uder a Waiver of Premium Rider. M25260_0510 7

12 DEATH BENEFIT The death beefit amout is: The face amout of the policy; plus Ay beefits provided by issued riders; plus Ay premium refud; mius Ay premium deductio. EXCLUSION RIDERS The death beefit will ot be paid if the Isured s death results from suicide, while sae or isae, withi two years from the date of issue. Istead, the compay will pay the sum of the premiums paid. The followig riders are available with the Term Life Portfolio products: Accelerated Beefit Rider Accidetal Death Beefit Rider* Depedet Childre s Rider** Other Isured Rider Waiver of Premium Rider* GRACE PERIOD REINSTATEMENT A grace period of 31 days is allowed for the paymet of each premium ecept the first. Policies may be reistated withi five years of the due date of the upaid premium. Reistatemet is subject to: Writte applicatio siged by both ower ad Isured. Evidece of isurability, icludig good health, satisfactory to the compay. Paymet of all past-due premiums with iterest at the rate of 6% for policy years REISSUES Policies caot be reissued to reduce a face amout, uless the request occurs i the iitial accoutig period. If the face *Not available o substadard issues **Not available if base isured is rated over 250% M25260_0510 8

13 amout is to be icreased, the policy should be replaced at the attaied age, icludig a completed applicatio resultig i a ew policy umber. The policy ca be reissued as log as the face amout of remaiig term eceeds the miimum face amout requiremet. Premiums are based o the ew bad ad face amout. CONVERSION For Term Life 10, the policyower may covert the Term Life policy to permaet isurace at ay time throughout the level term period, subject to the maimum coversio age of 74, or two years after policy issue, whichever is later. For Term Life 15 ad 20, the policyower may covert the policy to permaet isurace before age 75. For Term Life 30, the coversio privilege is limited to the first 15 policy years. At the time of coversio, o additioal uderwritig is required ad a lower face amout may be selected. RE-ENTRY SUMMARY At the ed of the iitial guaratee period, the Isured may be re-uderwritte based upo curret health to be issued a ew policy based upo the attaied age. Re-etry is ot allowed if the Isured eceeds the maimum issue age of the policy. The Term Life Aswers Portfolio offers traditioal term products with guarateed level premiums for 10, 15, 20 ad 30 years. Uit 3 covers the Term Life riders. M25260_0510 9

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15 INTRODUCTION RIDERS Accelerated Beefit Rider (i approved states) UNIT 3 RIDERS This uit will cover the riders available with the Term Life Portfolio. The followig riders are available: Accelerated Beefit Rider Accidetal Death Beefit Rider* Depedet Childre s Rider*** Other Isured Rider Waiver of Premium Rider* The o-cost rider goes ito effect if the Isured provides evidece to the compay that his or her life epectacy is 12 moths or less (varies by state, NJ 6 moths, WA 24 moths). The policyower ca elect to receive a percetage of the policy death beefit of 94%.* (See Note.) Oce the rider has bee elected, the policy will termiate. The ABR will be attached to policies for face amouts up to $500,000. The rider will NOT be attached to policies i ecess of $500,000. The ABR does ot apply to the other Isured (if ay). NOTE: Payout percetage ad life epectacy requiremets may vary by state. ABR Disclosure Form The Accelerated Beefit Rider Disclosure Form (L )** is required to be siged by the cliet at the time of applicatio for all term applicatios with face amouts betwee $100,000 ad $500,000. The disclosure form iforms the cliet that he or she will NOT be subject to ay adverse ta cosequeces at the time of applicatio, but that by eercisig the Accelerated Beefit Rider optio, the cliet may be subject to adverse ta cosequeces or may be ieligible for Medicaid or other govermet beefits or etitlemets. NOTE: If a applicatio is set i without a siged ABR Disclosure Form, Uderwritig will NOT approve coverage util a siged form is received. ***Not available o substadard issues **Natioal form -- some states use state-specific versios ***Not available if base isured is rated over 250%. M25260_

16 Accidetal Death The Accidetal Death Beefit provides for paymet of a Beefit Rider* additioal death beefit if the death of the Isured results directly from bodily ijury while the rider is i force. Depedet Childre s Rider* Other Isured Rider Etesio Optio Each uit of Depedet Childre s Rider provides $1,000 of term isurace o each covered child util the child s 23rd birthday or to the policy aiversary followig the Isured s 65th birthday, if earlier. Childre, bor or adopted, after the rider is issued, will be automatically icluded whe they attai the age of 15 days.** Whe the coverage o a child epires, the child may, without evidece of isurability, covert to ay form of permaet isurace, up to $5,000 for $1,000 of term coverage. Upo the death of the Isured covered uder the base policy, the term coverage o each child becomes paid up to age 23. This rider is ot available if the base pla is rated over 250%. The maimum umber of uits is 10. Other Isured is defied as ay oe perso who is ot the base Isured. There will be a set of curret ad guarateed premiums, based o the duratio specified i the base pla. The policy fee is waived. The Other Isured Rider available issue ages ad risk classes are the same as those of the base pla. The Other Isured has the optio to chage to his or her ow policy upo the death or termiatio of the base coverage (i.e., requested lapse due to busiess dissolutio or divorce). Uder these circumstaces, the Other Isured ca be issued a ew term policy which will have the same issue date as the origial base policy. The premiums will be based upo the Other Isured s age, se, risk ad rate class at the time the base policy ad Other Isured were issued, plus a $65 aual policy fee. The face amout of the ew policy may ot be greater tha the amout of the origial Other Isured Rider (OIR). The legth of the premium guaratees for the ew policy will be the same as the Other Isured Rider origially attached to the base policy. Follow the guidelies listed below to eecute the Other Isured Rider Etesio Optio: You will iitially receive a letter whe a policy qualifies to take this optio. You will have 60 days to cotact the Other Isured to take advatage of the etesio optio ***Not available o substadard issues ***may be issued through age 20. M25260_

17 If the Other Isured is iterested i takig advatage of the etesio optio, complete the coversio applicatio. Write the old policy umber i the upper right-had corer of the coversio applicatio ad idicate that the coversio is for the OIR Etesio Optio. This will esure correct hadlig by the uderwriter who receives the applicatio Uderwritig will issue the ew policy ad mail it to you for delivery to the Other Isured Waiver of Premium Rider SUMMARY The Waiver of Premium Rider, which is available for the Isured ad Other Isured, may be issued for ages ad is reewable util the aiversary followig the Isured s 65th birthday. This is a optioal rider that provides for the waiver of all successive reewal premiums should: The primary Isured become disabled prior to the policy aiversary followig age 60 ad The disability cotiue for at least si moths NOTE: It is automatically added to the Other Isured Rider whe the Waiver of Premium Rider is added to the base pla. Each Term Life Aswers policy offers riders that add fleibility to make your cliets coverage just right for each stage of life. M25260_

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19 UNIT 4 TERM LIFE EXPRESS AND TERM LIFE COMPLETE* Term Life Epress ad Term Life Complete offer a uique combiatio of term isurace products that allow you to customize a term life pla for your cliets. Term Life Epress, offerig simplified uderwritig, ad the fully uderwritte Term Life Complete, are desiged to provide your cliets with the features ad protectio they desire. These products may be ideal for recet home buyers or ayoe watig term life isurace to protect their families ad their lifestyles. Term Life Epress ad Term Life Complete offer fleible protectio to meet your cliets eeds. They provide moey to your cliets tha ca help: Pay off the mortgage upo death OR Make mortgage paymets if the Isured suffers a disability or becomes uemployed TARGET MARKETS Term Life Epress ad Term Life Complete target markets iclude: Idividuals ages with aual household icome betwee $35,000 ad $150,000 Recet home buyers Cliets desirig term coverage PRODUCT HIGHLIGHTS The Term Life Epress ad Term Life Complete products offer a variety of features, icludig: Ca help pay off the mortgage at the death of the Isured(s) Provide icome (optioal, cost rider) if the Isured(s) become disabled Waives premiums for si moths if uemploymet occurs Refuds all premiums paid (at the ed of the policy period if life isurace o loger eeded) (optioal, cost rider) *Subject to state approval M25260_

20 Provides several additioal cost ad o-cost riders, icludig Residetal Damage Rider Simplified uderwritig -- Term Life Epress; Full uderwritig -- Term Life Complete Pivot rage ($100,000-$400,000) allows aget to switch betwee products, depedig o circumstaces TERM LIFE EXPRESS TERM LIFE COMPLETE Product Optios* I additio to offerig mortgage protectio, Term Life Epress features a choice of eight term products ad icludes: A o-cost Residetial Damage Rider* Simplified uderwritig for face amouts betwee $50,000 ad $400,000 Retur of Premium is available Term Life Complete offers: Full uderwritig, begiig at $100,000, with lower rates tha Term Life Epress Face amouts that start at $100,000 with o limit to the amout that ca be writte A o-cost Residetial Damage Rider Coversio privileges i the first five years Retur of Premium FAV etry for Term Life Complete applicatios The followig product optios are available with Term Life Epress ad Term Life Complete: Products with Full Guaratee (premium guarateed for the etire term) 15-year Level Term 20-year Level Term 20-year Level Term with Retur of Premium 30-year Level Term 30-year Level Term with Retur of Premium *Product optios vary by state. M25260_

21 Products with Five-Year Guaratee (premium guarateed for first five policy years) 20-year Level Term 30-year Level Term You Should Recommed Are over age 60 (whether or ot they have curret Term Life Complete to mortgage) Caot afford Term Life Epress premiums Aswer yes to a accept/reject questio for simplified uderwritig Wat a face amout over $400,000 PIVOT RANGE The $100,000-$400,000 pivot rage, show below, allows you to pivot, or switch betwee the Term Life Epress ad Term Life Complete products, depedig o the circumstaces of the case. Simplified Uderwritig (Term Life Epress) $50,000...$400,000 Pivot Rage $100, $400,000 Full Uderwritig (Term Life Complete) $100,000...Plus Face Amouts Available face amouts for Term Life Epress ad Term Life Complete are: $50,000 - $400,000 (simplified uderwritig) -- Term Life Epress $100,000+ (full uderwritig) -- Term Life Complete Issue Ages Issue ages (age last birthday) are: Term Guaratee Without ROP With ROP Notobacco With ROP Tobacco 15-Year Full N/A N/A 20-Year 5-year 18-65* N/A N/A 20-Year Full Year 5-year 18-65** N/A N/A 30-Year Full *The 20-yr ad 30-yr (5-yr guaratee) products are ot available i WA. **Issue ages i FL, IN, NJ, OR, PA, UT ad WA M25260_

22 Policy Provisios* No cost policy provisios ad riders iclude: Commo Carrier Death Beefit Waiver of Premium for Uemploymet Accelerated Death Beefit (No Cost Rider) Residetial Damage Rider Commo Carrier Death Beefit (No Cost) Waiver of Premium for Uemploymet (No Cost) The Commo Carrier Death Beefit provides for a additioal death beefit equal to 100% of the origial face amout or $250,000, whichever is less, if the base Isured dies i a accidet while a passeger o a commo carrier (i.e., airplae, trai or bus). I the evet of qualifyig uemploymet, the Waiver of Premium for Uemploymet provisio provides for oe si-moth period whe premiums for the base pla ad all riders are waived if the Isured becomes uemployed. The base pla must be i force for 24 moths before uemploymet begis (9 moths i PA) Proof of uemploymet will be required A four-week elimiatio period will apply Accelerated Death The Accelerated Death Beefit provides a lump-sum beefit if the Beefit Isured provides evidece that his or her life epectacy is 24 (No Cost Rider) moths or less. The lump-sum beefit is equal to 92% of the death beefit.** Oce the 92% beefit is paid out, the policy will be termiated. Residetial Damage (No Cost Rider) The Residetial Damage Rider allows the premium for the base policy ad all riders to be waived for oe si-moth period if the primary residece sustais $25,000 or more i damages. This rider provides protectio agaist damage caused by atural disasters, such as hurricaes, floods, torados, earthquakes ad wild fires. *ot available i all states **The amout of refud depeds upo the year of surreder ad varies by state. M25260_

23 COST RIDERS FEATURES Retur of Premium Disability Icome Term Life Epress ad Term Life Complete offer the followig cost riders: Retur of Premium Disability Icome (ot available with Retur of Premium) Waiver of Premium for Total Disability* Accidetal Death Beefit Depedet Childre s The Retur of Premium (ROP) rider allows the Isured to receive a refud, up to 100% of all premiums paid ito the policy, upo surreder of the policy. The retur of premium amout will retur all available premiums, paid ad waived, icludig all policy fees ad all rider premiums. Eve if the Isured cacels the policy before the ed of the policy term, he or she may receive a partial refud* of the premium paymets. The Disability Icome Rider is available with the Term Life Epress ad Term Life Complete products. I the evet of a covered disability, the rider provides cash for either 18 or 30 moths*, after a 90-day elimiatio period.* (180-day elimiatio period i WA) NOTE: The defiitio of disability is ay occupatio for the etire 18 or 30 moths. Eample: Isured selects the 18-moth beefit The iitial disability lasts 12 moths The Isured has si moths of beefits remaiig.the Disability Icome Rider ca oly be added at policy issue, ad the premium is guarateed oly for the first year. The maimum mothly beefit is the least of: 1.5% of the face amout at issue $3,000 each moth or 60% of the Isured s mothly gross icome *may vary by state M25260_

24 Eample: Face amout at issue: $150, % $150,000 = $2,250 Gross mothly icome = $4, $4,000 = $2,400 Isured would receive $2,250 i mothly beefits Net Mothly Icome Disability Beefit The et mothly icome disability beefit payable equals the mothly icome beefit reduced by the amout of social isurace* beefits received, if ay, for the total disability beig claimed. Social Isurace meas disability or retiremet beefits the Isured is receivig due to a curret sickess or ijury. Regardless of ay reductio due to social isurace, beefits payable for the total disability will ot be less tha $50 a moth. Eample: Mothly Icome Disability Beefit $1,200 Mothly Social Security Disability Beefit $800 Net Mothly Icome Disability Beefit $400 *Social isurace beefits iclude Social Security disability or retiremet beefits, *workers compesatio beefits, govermet retiremet ad/or disability fud *beefits ad Railroad Retiremet Act disability icome or retiremet beefits. NOTE: If the Isured is covered uder ay other disability beefit pla at the time of applicatio, idividual cosideratio will be give by Uderwritig to the total beefit amout available uder the rider. Waiver of Premium for Total Disability The Waiver of Premium for Total Disability Rider provides that I the evet of a covered disability, all premiums will be waived for the base policy ad all rider premiums will be waived after a 90-day elimiatio period. * *may vary by state M25260_

25 Accidetal Death Beefit The Accidetal Death Beefit Rider provides for a additioal death beefit i the evet of the Isured s accidetal death. The miimum rider amout is $10,000. Issue ages ad available amouts are: 18-25: $100, : $250,000 OR 1 the face amout, whichever is less Depedet Childre s Rider The Depedet Childre s Rider is available o may of the Term Life Epress ad Term Life Complete plas. The rider ca be added oly at time of issue. The issue age of the base Isured must be Face amouts available are $5,000 or $10,000. The Depedet Childre s Rider termiates ad the premiums stop at the earlier of the aiversary date followig the isured s age 65 or whe the yougest child attais age 23. The rider covers all umarried childre (age 15 days through 23 years) who are members of the isured s household ad listed i the applicatio. Childre bor or adopted after issue of this rider are icluded automatically whe they attai the age of 15 days. Whe the coverage o a child epires, the child may, without evidece of isurability, covert to ay form of permaet life isurace up to $5,000 for every $1,000 of isurace. Coverage is available to the base policyower oly. The Childre s Rider is available i $5,000 ad $10,000 amouts. Premium Guaratee Premium Modes The premium for the 15-year level term product is guarateed for the etire term. Available premium modes iclude: Aual (1.00) Semiaual (.52) Quarterly (.275) Mothly BSP (.089) M25260_

26 UNDERWRITING CLASSES Simplified uderwritig is available up to $400,000. The chart below lists the available uderwritig classes with the followig face amouts. Term Life Epress Face Amouts Term Life Complete Simplified Uderwritig Full uderwritig through Table 16 Uderwritig Classes Uderwritig classes: Stadard Notobacco Preferred Tobacco Stadard Tobacco Preferred Notobacco Stadard Notobacco Stadard Tobacco GRACE PERIOD The grace period is 31 days. POLICY FEE The aual policy fee for is $60. RENEWABILITY POLICY EXCLUSIONS Policies may be reewed aually to age 100, without evidece of isurability. The policy s face amout will ot be paid if the Isured s death results from suicide, while sae or isae, withi two years of the date of issue (i Colorado ad North Dakota, withi oe year). Istead, Uited of Omaha will pay the sum of premiums paid sice issue. NOTE: I Missouri, beefits will be paid for all causes of death uless evidece shows that suicide was iteded at the time of death. *Term Life Complete: to age 85 for the 15-year term product M25260_

27 PRODUCT COMPARISON The chart below provides a compariso betwee the features available with Term Life Epress ad Term Life Complete. Products/Issue Ages (Fully Guarateed) Term Life Epress Term Life Complete Issue Ages Issue Ages 15-year Level Term year Level Term year Level Term year Level Term year Level Term w/retur of Premium 20-year Level Term w/retur of Premium 30-year Level Term year Level Term (5-year Guaratee) Uderwritig Class Uderwritig 30-year Level Term w/retur of Premium 20-year Level Term year Level Term Stadard Notobacco Stadard Tobacco Simplified Uderwritig (Stdthrough Table 4) 30-year Level Term w/retur of Premium 20-year Level Term year Level Term Preferred Notobacco Preferred Tobacco Stadard Notobacco Stadard Tobacco Stadard (Table Rated) Notobacco ad Tobacco Full Uderwritig Bads $50,000 - $400,000 $100,000 - $249,999* $250,000 - $499,999 $500,000+ No Cost Policy Features** Accelerated Death Beefit Rider Uemploymet Provisio Commo Carrier Death Beefit Provisio Residetial Damage Rider Accelerated Death Beefit Rider Uemploymet Provisio Commo Carrier Death Beefit Provisio Residetial Damage Rider *miimum face amout of $250,000 for 20-year term ad 30-year term ROP products **may vary by state M25260_

28 Term Life Epress Term Life Complete Cost Policy Features Disability Icome Rider (Not available for Retur of Premium) Retur of Premium Waiver of Premium Due to Disability Rider Accidetal Death Beefit Rider Childre s Rider Policy Fee $60.00 Grace Period 31 Days Coversios Not Allowed Allowed i the first 5 years to a product desigated by the compay Premium Modes Aual 1.00 Semiaual 0.52 Quarterly Mothly BSP TERM LIFE EXPRESS APPLICATION PROCESS Part 1 Proposed Isured Iformatio The LAP1111* applicatio packet is used for the Term Life Epress product. The LAP1100* applicatio packet is used for the Term Life Complete product. I this sectio, we will show the applicatio process for Term Life Epress. Make certai to complete all appropriate iformatio. Clarify with the proposed primary Isured that this is the ame he or she wats to have show o the records. Be sure that the ame o the applicatio matches the ame provided durig the uderwritig iterview. The proposed primary Isured s legal residece address must be etered clearly ad completely. Also iclude the address, if available. Make certai to iclude the Best Time to Call. Joh W. Applicat XX NE $58, NE 2121 Oakdale Rd 6 pm JWApplicataet.et Salesma XLZ Doors *or state equivalet M25260_

29 Pla Iformatio It is importat to use the precise pla ame o the applicatio to avoid applicatio amedmets. Be specific whe selectig the riders for each pla ad iclude the rider amout. Select the paymet mode ad premium. 250,000 1,800 M25260_

30 Ower Complete the Ower Iformatio sectio, if the ower/applicat is differet from the proposed Isured. Make certai to complete the Secodary Addressee iformatio, if applicable. Beeficiary The Beeficiary iformatio sectios must be completed for all applicats. Make certai to iclude the relatioship, % share ad date of birth for each listed beeficiary. Susa A. Applicat 100 spouse Other Coverage Iformatio It is importat to list all life isurace policies ad auity cotracts that are i force or pedig. Iclude 1035 Echage ad Replacemet details. (Check Yes or No) M25260_

31 Uderwritig Each questio i the Uderwritig sectio must be aswered, icludig the tobacco questio (#9); ad the persoal physicia details i questio 10, if the Proposed Isured is over age 60. M25260_

32 agreemet The Agreemet sectio must be siged by the Proposed Isureds. Aytow NE 2 / 15 / XX Joh W. Applicat Ssusa A. Applicat M25260_

33 Producer Statemet All questios must be aswered o the Producer Statemet. It must be siged ad dated by the aget, ad the Geeral Maager s ame must be icluded at the bottom of the form. Haley Adams 01/X15 2/15/XX Marily Johase M25260_

34 Mothly Bak Withdrawals This sectio should be completed if the applicat selected the Mothly BSP mode. M25260_

35 Authorizatio to Disclose Persoal Iformatio The Authorizatio to Disclose Persoal Iformatio form must be siged by the applicat. Joh W Applicat 2 / 15 / XX M25260_

36 Accelerated Beefit This rider is part of the policy. The disclosure must be siged by Rider Disclosure the applicat. Joh W Applicat 2/15/XX Haley Adams 2//15/X X M25260_

37 Coditioal Receipt This agreemet must be retured with the applicatio to the Home Office. Do ot collect a check for the iitial premium if ay proposed Isured is applyig for more tha $100,000 of isurace. The customer copy must ot be give to the applicat if a check for the iitial premium was ot collected at the time of applicatio. Aytow NE 2 / 15 / Stadard NT M25260_

38 M25260_

39 Summary of Your Rights These pages may be left with the applicat/ower. M25260_

40 M25260_

41 summary Term Life Epress, offerig simplified uderwritig, ad Term Life Complete, offerig full uderwritig, provide a uique combiatio of term isurace products that allow you to customize a term life pla for your cliets. M25260_

42

43 UNIT 5 COMPLETING THE APPLICATION Applicatio Checklist Oe applicatio is used for Term Life Complete, GUL Complete, Term Life Aswers, Term Life riders ad AccumUL Plus. Use the applicatio checklist to be sure you have completed all the ecessary paperwork. M25260_

44 Three-Part Applicatio Part 1A (two pages) Proposed Isured Proposed Isured Iformatio The applicatio cosists of three parts: Complete all of the iformatio i the Proposed Isured sectio. As with all products, clarify with the proposed primary Isured that you have the complete legal ame that he or she wats to have show o the records. Ad make certai that the ame o the applicatio matches the ame provided durig the uderwritig iterview. Complete all other fields, icludig geder, height, weight, Social Security Number, date of birth, state of birth, aual icome, driver s licese umber, legal residece address, best time to call, phoe umber, address, occupatio/ duties, ad employer. Michael W. Hase /15/ NE $75,000 JX Armstrog Ave. 7 pm mhase@ .com Systems Aalyst SYS, Ic. NE Pla Iformatio It is importat to use the eact product ame, ay rider ames ad amouts, paymet mode, modal premium amout, ad the amout of the collected premium. 20 Term Life Aswers 250,000 Other Isured $100,000 2, , M25260_

45 Ower ad Beeficiary Complete the Ower sectio, if the ower/applicat is differet from the proposed Isured. Make certai to complete the secodary addressee iformatio, if applicable. The Beeficiary Iformatio sectio must be completed for all applicats. Make certai to iclude the relatioship, % share ad date for each listed beeficiary. Marily Hase 100 Spouse 5/21/ Commets List ay pertiet additioal commets i this sectio. Rider o Other Proposed Isured Complete the Other Proposed Isured Rider iformatio sectio, if applicable. M25260_

46 Family History Complete this sectio o the Proposed Isured ad Other Proposed Isured, if applicable. o-medical Uderwritig Make certai to check the appropriate boes fore questios 1-3 of the No-Medical Uderwritig sectio for both the Proposed Isured ad the Other Proposed Isured Rider. If applicable, the Tobacco/ Nicotie Replacemet Therapy sectio must also be completed. Fiaces Questio 4 (bakruptcy questio) i the Fiaces sectio must be aswered (Yes or No). The purpose of the isurace must also be listed i questio 5. If the proposed Isured is applyig for $500,000 or more, the pertiet iformatio must be completed for questio 6. M25260_

47 Part 2 The Medical Uderwritig sectio must be completed for all Medical Uderwritig applicats. If the applicat aswers, Yes, to ay questio, list the details i the Commets sectio. Be sure to idetify the questio umber ad circle applicable items. Michael Dr. Thomas Doctor Dodge Omaha, NE 10/25/XX Physical for Work M25260_

48 Agreemet This sectio is the Authorizatio to Receive Iformatio from ad Disclose Iformatio to the MIB Group Ic. ad should be read ad siged by the applicat. Omaha NE 12/8/ Michael W. Hase M25260_

49 Producer Statemet The Producer Statemet eeds to be siged by the producer(s). Make sure to iclude applicable productio umbers, date ad agecy ame. Haley Adams / 8 / PLEASE SUBMIT ALL PAGES M25260_

50 Moey Bak Withdrawals This sectio should be completed if the applicat selected the Mothly BSP mode. M25260_

51 Authorizatio to Disclose Persoal Iformatio The Authorizatio to Disclose Persoal Iformatio form must be siged by the applicat. Michael W. Hase 12 / 8 / XX M25260_

52 Accelerated Beefit This rider is part of the policy. The disclosure must be siged by Rider Disclosure the applicat. Michael W. Hase 12/8/XX Haley Adams 12//8/X X M25260_

53 Temporary Life Isurace Agreemet ad Receipt This agreemet must be retured with the applicatio to the Home Office. Do ot collect a check for the iitial premium if ay proposed Isured is applyig for more tha $500,000 of isurace, or if the aswer to questio 4 is yes. Oly leave a copy of the form with the applicat, if a check for the iitial premium was collected at the time of applicatio. PLEASE SUBMIT ALL PAGES M25260_

54 Summary of Your Rights These pages ca be left with the applicat/ower. M25260_

55 M25260_

56 M25260_

57 UNIT 6 UNDERWRITING PROCESS INTRODUCTION UNDERWRITING GUIDELINES Telephoe Iterview This uit covers details cocerig the uderwritig process, icludig: Uderwritig Guidelies Telephoe Iterview Requiremets For accurate uderwritig, you will eed to complete the applicatio, collect the premium amout (if applicable based o TIA guidelies), determie ad eecute the ecessary testig procedures (oral fluid, blood ad urie, paramed, etc.). Be sure to idicate all the uderwritig requiremets iitiated or completed o the submissio checklist. You are the best eyes ad "ears" for our compay. It is always importat to submit complete, accurate applicatios. The followig are geeral uderwritig guidelies for Uited of Omaha s life products. The telephoe iterview requiremets listed below apply to the followig products ad face amouts: Term Life Aswers 10, Term Life Aswers 15, Term Life Aswers 20 ad Term Life Aswers: 30 $100,000 - $999,999 A telephoe iterview is ot required. However, a Home Office iterview may be ordered, based o the quality of the iformatio o the applicatio. (A telephoe iterview will ot be ordered if it is clear from the applicatio that the aget wet through each questio i detail ad completed the applicatio questios accurately.) For face amouts $1,000,000+: A telephoe iterview is always required (up to the ispectio report limit). Uited of Omaha requires additioal third-party verificatio of medical ad omedical histories for large face amout applicatios. M25260_

58 The followig provides a summary of the telephoe iterview requiremets. Telephoe Iterview Product Face Amout Required? Term Life Aswers 10 $100,000 - $999,999 Iterview at uderwriter s Term Life Aswers 15 discretio. Term Life Aswers 20 Term Life Aswers 30 Term Life Aswers 10 $1,000,000+ Iterview always required. Term Life Aswers 15 Cliet will call. Term Life Aswers 20 Term Life Aswers 30 Term Life Epress Uderwritig Requiremets Age Amout beig Uderwritte: $50,000 $250,000 $250,001 $400,000 Simplified Uderwritig Stadard through Table 4 Pharmaceutical Radom Iterview Simplified Uderwritig Stadard through Table 4 Pharmaceutical Phoe Iterview APS (Madatory) Simplified Uderwritig Stadard through Table 4 Pharmaceutical Phoe Iterview Oral Fluids Simplified Uderwritig Stadard through Table 4 Pharmaceutical Phoe Iterview Oral Fluids APS (Madatory) Note: Oral Fluid Kits ca be obtaied o SPA Aget mails Oral Fluid Kit to Lab Kit is processed through Cliical Referece Lab (CRL) M25260_

59 Risk Criteria Now that we ve covered the available term products ad the uderwritig process, let s look at the sales ad marketig strategies for all of the term products. M25260_

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61 UNIT 7 SALES AND MARKETING IDEAS INTRODUCTION This uit cotais several sales ad marketig ideas you ca utilize i your presetatios to potetial cliets. Topics discussed i this uit iclude: Sales Fudametals Target Markets Basic Needs Mortgage Protectio Cliet Brochures Prospectig/Preapproach Materials Term Coversio Strategy SALES FUNDAMENTALS I additio to offerig your cliets products ad services which meet their isurace eeds, you must also provide the kid of service your prospects deserve. To effectively close sales, you must kow: The eeds ad wats of your prospects The priority of their eeds Your products ad how they ca satisfy those eeds How to coduct a effective sales iterview ADVANTAGES TO BUYING Accordig to the All Life Isurace Quotes website at TERM INSURANCE isurace-quotes.com,* advatages to buyig term life isurace iclude: Iitial premiums are lower tha those of permaet isurace, allowig you to buy more coverage at a youger age, whe the eed is the greatest It is good for a specific eed that disappears over time, such as a mortgage, childre s educatio costs or a automobile loa The policy proceeds pass to the beeficiary ta free *August, 2004 M25260_

62 REASONS PEOPLE All Life Isurace Quotes website lists the followig as the BUY TERM INSURANCE mai reasos idividuals buy term life isurace: For coverage durig the child-rearig years To provide mortgage protectio For low-cost life isurace protectio TARGET MARKETS The key target markets for the term products are Established families Youg empty esters Classic empty esters Small busiessowers The followig iformatio illustrates the recet treds amog idividuals buyig term isurace. All statistical iformatio was provided by the LIMRA Life Buyer Study. Who s Buyig Term Age Term isurace cotiues to icrease i sales to both geders. Both me ad wome are purchasig a larger amout of term isurace. Why? Term isurace is growig i popularity due to competitive pricig o products with log-term premium guaratees. The table below idicates the umber of people who bought term policies i 2005 by age. Age Percetage of Idividuals Who Purchased Term Policies 55 ad over 49% % % % % % % BASIC NEEDS As metioed i Uit 1, there are several reasos why a prospect may wat to purchase a term isurace policy, icludig a lower cash outlay ad the eed for temporary protectio. Some specific eamples of basic eeds that idividuals/busiesses may have iclude: M25260_

63 Idividuals Mortgage/Persoal debt repaymet Educatio epeses Icome cotiuatio Settlemet fud Busiesses Loas/Debt obligatios Busiess start-up epeses Key perso coverage Let s take a look at four eamples where a term product ca help to fud a particular eed. These eamples iclude: Icome Cotiuatio Educatio Epeses Busiess Start-up Epeses Mortgage Protectio Icome Cotiuatio Term products ca help a family through the period of fiacial adjustmet that follows the death of a family member. The eed may be more proouced i cases where the deceased idividual was the primary breadwier or made a major cotributio to payig regular mothly epeses. Eample: David Mitchell is 27 years old, married ad has a threeyear-old so. His wife, Marie, works part time at a childre s clothig store i the shoppig ceter. David has recetly bee promoted to assistat forema i the auto body shop where he works. Mr. Mitchell has owed $30,000 of life isurace for several years ad has aother $30,000 of group life isurace. He realizes that as log as he is alive ad healthy, he will be able to provide for his family. However, should aythig happe to him, he kows that his wife ad youg so will have to rely solely upo his life isurace ad Social Security. His family eeds additioal life isurace protectio, but it is more tha he ca afford to buy o a permaet basis at this time. David s prospects for future advacemets are bright--with this i mid, he decides to buy a $100,000 Term Life Aswers 10 isurace policy with a Other Isured Rider ad a Depedet Childre s Rider. He plas to covert it to a permaet policy whe he ca afford the larger premium required. M25260_

64 Educatio Epeses I the evet of the Isured s death, a term product ca provide eeded fuds for educatio epeses, icludig private schoolig for the elemetary ad secodary grades, as well as college or trade school traiig. Eample: Joh ad Marcy Aderse have two childre, ages 12 ad 13. Up to the preset time, they have bee uable to set aside a college educatio reserve. Joh has recetly received a promotio with a sizable icrease i salary, which will allow Joh ad Marcy to set aside fuds for their childre s educatio. The Aderses decide to purchase a $200,000 term policy--if Joh should die while the policy is i force, the childre s educatio would be protected. NOTE: The Aderses have the optio to covert to a permaet pla. Busiess Start-up Epeses A term product ca offer a solutio to prospects who are just startig a ew busiess. If the ower(s) lack(s) cash flow at the preset time, but pla(s) to covert to a permaet policy as the compay s profits grow, a Term policy ca fill the eed util the cash flow is sufficiet to cover the premiums for the permaet policy. Eample: Harry Stephes recetly icurred $500,000 i start-up epeses for his ew busiess, the H&A Meat Compay. The majority of these epeses are for idustrial freezers ad productio lie processig equipmet, ad he has take out a 15-year bak loa to cover his debt. Harry realizes that he eeds to purchase a life isurace policy to cover the debt i the evet of his death durig the 15-year period. Because a great deal of the compay s icome goes to retire the debt, he lacks the ecessary cash flow at the preset time to purchase a permaet policy. He decides to purchase a $500,000 Term Life Aswers 20 policy, with plas to covert to a permaet policy oce he has the ecessary cash flow. M25260_

65 Mortgage Protectio Most people would agree that the largest debt idividuals have durig their lifetime is the mortgage o their home. Cosider the followig: The average size of a mortgage i 2006 was over $182, Whe a 35-year-old married couple purchase a home, there is a 30% chace that oe spouse will ot survive to the ed of a 30-year mortgage. 2 The average osmoker male who purchases a home at age 35 has roughly a 1 i 5 chace of ot survivig to the ed of a 30-year mortgage.* *Source: 1980 CSO Mortality Table, age 35, osmoker Eample: George ad Kristi Brow are i their mid-40s ad have recetly purchased a $250,000 home with a 30-year mortgage. George ad Kristi are both workig ad have grow childre who are o loger livig at home. The Brows have a $500,000 permaet life isurace policy, but they feel a term policy would be appropriate to cover the mortgage i the evet of either of their deaths durig the 30-year time period. For eample, o a $250,000 balace, the total iterest paid over the 30 years, with a 7% iterest rate, is about $349,000; almost times the origial mortgage balace. If either George or Kristi dies 10 years ito the mortgage ad the mortgage is paid i full, they have saved over $182,000 i iterest paymets. They decide to purchase a $250,000 Term Life Aswers 30 policy with a Accelerated Beefit Rider ad a Waiver of Premium Rider. They will have the assurace that the mortgage will be paid off i the evet of either of their deaths. Term vs Permaet Isurace There are several reasos for sellig ad owig term isurace, icludig satisfactio of short-term eeds ad obtaiig higher levels of isurace at a price cliets ca afford to pay while protectig future isurability. However, eeds ad fiacial situatios chage over time ad may idividuals fid that their eed for life isurace protectio also icreases. I additio, most cliets would prefer to evetually ow their isurace, rather tha ret it. M25260_ Source: Mortgage Data, Bakers Associatio 2 Source: 1980 CSO Mortality Table, age 35, osmoker

66 SALES AND MARKETING MATERIALS TERM CONVERSION STRATEGY There are several materials ca be helpful whe presetig the Term products to potetial or eistig cliet. Refer to Forms ad Materials for a complete list. As illustrated with the previous eamples, term isurace provides temporary protectio. Most of the term isurace purchased is bought to cover a permaet eed by someoe who caot afford to buy a permaet solutio. Whe idividuals purchase a term isurace policy, oe of two evetualities happes: Term isurace termiates at some poit i time while the Isured is still alive or It becomes prohibitively epesive ad is dropped. I fact, less tha 2% of all term isurace ever culmiates i a beeficiary receivig beefits. As a result, to provide better service to your cliets, you should stay o top of the situatio ad come back to the cliet as ofte as ecessary util a permaet solutio has bee established. Set the stage for term coversio at the iitial sale. Emphasize that the Mutual of Omaha compaies have a strog permaet life portfolio so the right products are there whe it s time to covert to permaet coverage. Discuss why permaet isurace is importat. Eplai that eve though they have a temporary eed today, they ever kow whe a temporary eed may become log term or permaet. Emphasize that they are oly retig their isurace rather tha owig it. Cotact cliets every year followig the sale by phoe or letter remidig them of the optio of covertig all or a portio of their term isurace. A suggested approach you ca use: (Name), you have a sigificat amout of your life isurace with us. Your policy icludes a optio that you ve bee payig for ad we eed to get together to discuss it. Will (day) at (time) be coveiet? Or, would (day) at (time) be better? Remid cliets that they are just retig their isurace ad that they would ot be icreasig their coverage, just chagig from retig to buyig. Eclose two compariso proposals; oe with the curret age ad oe a year or two older. Frequetly, seeig the impact of waitig o their cash values becomes a icetive for covertig. M25260_

67 By platig the seed at the time of the term sale, you ll fid that it is much easier to retur ad covert that term to permaet isurace at a later date. Large term coversios come from practice, good sales proposals ad illustratios, ad persistet follow-up. Policyowers are most likely to egage i a ope ad meaigful coversatio about their permaet isurace eeds if a bod of trust is developed with their aget--you. Durig the follow-up iterview, try to covert all the term by showig the cliet ot the etire premium, but oly the differece betwee what is beig paid ad the amout to be paid for permaet isurace. Lifetime Protectio Brochure (LC1975) Preset the Lifetime Protectio brochure to the cliet which emphasizes the followig: Term isurace is a short-term solutio Permaet life isurace provides lifelog protectio You ca also discuss the reasos to covert term isurace; for eample: Permaet coverage is available regardless of curret health A lifetime of premiums is substatially less o a permaet pla of coverage Permaet coverage provides fleibility i meetig the cliet s isurace ad fiacial eeds Permaet isurace provides a opportuity to build cash values for a child s educatio, dream home or retiremet is available Permaet isurace ca be assigable collateral property which ca help secure persoal or busiess loas Log-term cash growth is accomplished o a ta-deferred basis The protectio will be there whe it is eeded Coversio to Permaet The policyower ca covert his or her term policy, without evidece of isurability, to ay available form of permaet isurace at ay time prior to the Isured s: 75th birthday (or two years after issue, if later, for Term Life 10 oly) M25260_