Summary Product Specifications

Transcription

1 PRODUCT OVERVIEW 1

2 Agenda I. Management Introduction II. Genesis Life Product Features III. COF Basic Value Life Product Features IV. Transition to Genesis Life V. Illustration Software VI. LifePRO VII. PASS/Agent Source VIII.Next Steps 2

3 Summary Product Specifications Genesis Life Flagship participating WL product $50,000 minimum face amount Level premium Competitive premium rates and dividend scale 3

4 Summary Product Specifications Basic Value Life Low face amount participating WL product No premium flexibility Same premium rates as Genesis Life with modified dividend scale 4

5 Design Concept Genesis Life combines the best features of Traditional Whole Life (strong guarantees) Universal Life (flexibility) 5

6 Design Concept Step 1 Start with a traditional participating whole life policy Level annual premium during coverage period Schedule of guaranteed cash values Traditional dividend options Paid-Up Additions Cash Dividends to reduce premium payment Dividend accumulation 6

7 Design Concept Step 2 Step 3 Allow policy holders to create a guaranteed limited payment policy by paying additional premium Create flexibility by allowing policy holders to: Adjust the premium up or down if needed Apply dividends to accelerate the process 7

8 New Components Face amounts segmented into premium paying (ordinary) and paid-up amounts Excess Premium Fund allows additional premium to pay-up ordinary insurance Additional Dividend Option referred to Internal Funding Dividend Option allows for dividend value to pay-up ordinary insurance 8

9 Policy Description On the policy s issue date, the face amount will consist entirely of ordinary insurance Ordinary insurance will be converted to paid-up insurance on each anniversary based on the amount of premium paid in excess of the required premium during the year and the amount of any dividend allocated to the internal paid-up insurance dividend option Issue ages: 0 85 (maturity age 121) 9

10 Risk Class Face Amounts Minimum $50,000 $50,000 Standard Non-Tobacco and $99,999 Standard Tobacco* $100,000+ Super Preferred Non-Tobacco Preferred Non-Tobacco Standard Non-Tobacco Preferred Tobacco* Standard Tobacco* Note: No longer have Select underwriting class *Tobacco users: Rates begin at age 18 Table ratings and flat extras may be applied to Standard. 10

11 Advantage Relative to Traditional WL More effective Cash Value development Not committed to Limited Pay Premium More flexibility for paying additional premium Can reduce required premium over time 11

12 Premium Concepts Required Premium The minimum amount that the owner must pay for ordinary life insurance in force and any premium-paying riders Based on ordinary face amount at the beginning of the year Excess Premium Any premium paid in excess of the required premium 12

13 Premium Concepts Planned Premium The amount the owner has elected to pay based on his or her goals This is the amount that will be billed May be changed, subject to required minimum premium Policy fee $50 per year (fully commissionable) 13

14 Premium Premium Change in Premium Over Time Genesis Life Traditional Whole Life Duration Duration Required Excess 14

15 Face Amount Change in Face Amount Over Time (Guaranteed Values) Genesis Life Duration Ordinary Paid-Up 15

16 Face Amount Change in Face Amount Over Time (Guaranteed Values) Traditional Whole Life Duration Ordinary Paid-Up 16

17 Advantages of Prefunding Increased cash values (current and guaranteed) Policy becomes guaranteed paid-up before maturity date Reduces overall outlay required Reduces required premium (flexibility to reduce premium in the future) 17

18 Premium Modes Policy premiums may be paid: annually, semi-annually (0.520), quarterly (0.265) or by monthly Pre-Authorized Check (0.0875) Grace period The policy will remain in force during the 31 day grace period 18

19 Automatic Premium Loan Any required premium in default at the end of the grace period may be paid by automatic premium loan subject to the following conditions: 1) The owner must make a written request for the automatic premium loan option prior to the due date of the premium in default or elected on application at the time of issue. 2) Any dividends accumulated must be applied to pay the premium before a policy loan will be made. 3) The loan value must be sufficient to permit the premium loan. 19

20 Dividend Options Dividend Accumulation Leave dividends on deposit with COF to earn taxable interest Dividends to Reduce Premium Payment Use dividends to pay part or all of (if sufficient) the policy premium Cash Dividends paid in the form of a check 20

21 Dividend Options Paid-Up Additions Increase coverage by using dividends to purchase additional, paid-up life insurance Default option when the policyholder hasn t made a selection Internal Paid-Up Insurance Convert ordinary insurance to paid-up insurance 21

22 Withdrawals Policyholders may: surrender any portion of the paid-up life insurance for its cash value surrender any portion of the paid-up additional insurance for its cash value request that any dividend accumulations or excess premium balance be returned policy loan *Note: Decreases in the ordinary insurance face amount not allowed. 22

23 Policy Loans Beginning the second policy year, the policyholder may request a loan against the net cash value of the policy provided that the policy: 1. is in force and there are no premiums in default, and 2. is not in force as extended term insurance LifePRO will calculate the proper amount when quoting Loan interest rate 5% fixed loan rate with Direct Recognition Adjustment 23

24 Policy Loans Direct recognition Dividends will be adjusted for policy loans. Whenever the outstanding loan balance equals or exceeds the maximum loan value, the policy will terminate without value. The policy will not terminate until 31 days after the company notifies the policyholder of the impending termination. (Follow current company practice on over loaned policies.) 24

25 Death Benefit The death benefit is equal to: 1. the face amount of ordinary insurance; plus 2. the face amount of paid-up insurance; plus Paid-up base face value Paid-up additional insurance riders Paid-up additional insurance purchased through dividends 3. the net excess premium balance on the date of the insured s death; plus 4. any remaining dividend accumulations; plus 5. any dividend credited at the time of the insured s death; plus (Continued) 25

26 Death Benefit 6. the portion of any required premium paid for any period after the insured s death; less 7. any outstanding policy loan balance; less 8. the part of any required premium in default for any period prior to the insured s death 26

27 Net Cash Value (Surrender Value) The net cash value of the policy is equal to: 1) the cash value of any ordinary life insurance in-force; plus 2) the cash value of any paid-up life insurance in-force; plus Paid-up base face value Paid-up additional insurance riders Paid-up additional insurance purchased through dividends 1) the net excess premium balance; plus 2) the amount of any unearned net premium; plus 3) any remaining dividend accumulations; plus 4) any dividends payable on the policy, less 5) any outstanding policy loan balance. 27

28 Non-Forfeiture Options Cash Surrender Value The net cash value will be paid as of the default date Paid-up Life Insurance The policy will remain in-force as paid-up life insurance and the ordinary face amount will be converted to paid-up life insurance by applying the ordinary life insurance cash value to the net single premium under the non-forfeiture basis of values Default for rated policies 28

29 Non-Forfeiture Options Extended Term Insurance The policy will remain in-force as extended term insurance The amount of the term insurance will be equal to: 1) the face amount of ordinary life insurance; plus 2) the face amount of paid-up life insurance; plus 3) any remaining dividend accumulations or paid-up additional insurance paid amount; less 4) any outstanding loan balance The term period will be set so that the net single premium for the extended term insurance is equal to the cash surrender value Default for Standard classes 29

30 Available Riders 1 Accelerated Death Benefit Rider Allows a portion of the policy s eligible death benefit to be accessed should the insured be diagnosed with a terminal illness with a life expectancy of 12 months or less 2 Fraternal Legacy Benefit Rider Name a qualified Catholic beneficiary to receive an additional 5% of the insurance policy s initial death benefit at no additional cost to premium May be spread across multiple, qualified Catholic charities 3 1 Not all riders are available in every state and some states vary the terms of certain riders. 2 Various states have established different life expectancy periods once the terminal illness has been diagnosed. Additional limitations and conditions may apply. A COF representative will provide complete information. 3 Subject to terms and conditions. 30

31 Available Riders 1 Guaranteed Insurability Option A guaranteed insurability rider, also called a GI rider, is a life insurance rider which allows the owner of a life insurance policy to buy additional life insurance with no additional underwriting Paid-up Additions Rider Permits the purchase of additional paid-up insurance Two separate premium options are available: Single Premium and Level Annual Premium 1 Not all riders are available in every state and some states vary the terms of certain riders. 31

32 Available Riders 1 Waiver of Required Minimum Premium Waives the required minimum premium due for the policy and any eligible riders Waiver of Specified Premium Waives a specified premium amount greater than the required premium 1 Not all riders are available in every state and some states vary the terms of certain riders. 32

33 Policy Description Issue Ages 0 85 ALB (age last birthday) Rate Classes Standard Non-Tobacco Standard Tobacco Face Amount $25,000 (New Underwriting) or Option Amount GIO (Guaranteed Insurability Option) Exercise/Conversions 33

34 Policy Description Dividend Options Cash Dividend Accumulation Dividends to Reduce Premium Payment Paid-Up Additions Note: 1 st dividend paid on 10 th Anniversary Policy Loans 5% fixed loan rate with Direct Recognition Adjustment 34

35 Optional Riders Waiver of Premium (WP) Guaranteed Insurability Option (GIO) single Single Paid-Up Additions (Exchanges only) Accelerated Death Benefit Rider (ADB) 35

36 Illustration Demonstrations Div Options 36

37 Illustration Demonstrations Premium Options 37

38 Illustration Demonstrations Named Premium Option 38

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55 Rollout and Transition from Existing Products 55

56 Timeline February 17, 2015 Genesis Life launch date February 17 May 15, 2015 Forester Life available for any amount within current limits Home Office accepts apps for Forester Life POSTMARKED through May 15,

57 Timeline Mid April, 2015 until COF Basic Value Whole Life is available Forester Life only $25,000 Once COF Basic Value Whole Life is available, Forester Life will be discontinued 57

58 Timeline February 17 June 30, 2015 Apps for the following products will be accepted through APPS DATED June 30: 10-Pay Whole Life 15-Pay Whole Life 20-Pay Whole Life 58

59 Timeline July 1, 2015 COF will have the following products available: Genesis Life COF Basic Value Whole Life Special needs Conversion GPO option for less than $25,000 or $25,000 $49,999 59

60 Next Steps Questions? Contact the Home Office Stay tuned for more details 60