Answering Objections to EIUL

1. Answering Objections to EIUL Presented by Ronald W. Norvell CLU.,CHFC Vice President, Sales Development Request a copy of this presentation to Uplife@aol.com 1-888-565-6900

2. Equity Indexed U.L.

3. Three Equity Indexed Universal Life Products • Vista Advantage/Advantage Builder – low target • Vista Select/Liberty Builder – mid target • Vista Elite/Vision Builder – high target • No variable licensing required to sell

4. “Before you Say” “It’s too hard to explain to clients!” Let’s Make it simple

5. Let’s Make it Simple • It is like all the traditional universal life plan you have ever sold. • Cost of insurance • Monthly expenses • Portfolio growth • It’s the interest rate crediting that is different. - instead of a bond rate crediting - we credit the S&P 500 index rate of return

6. Keeping it simple, know these Concepts! • Index & Index Earnings • Participation Rate • Cap Rate • Segments • The Six Guarantees • Two Loan Capabilities

7. What is an Index ?

8. The S&P 500 • Tracks 500 selected companies as an indicator of the growth in our economy S&P 500 Industry weightings How various industries were represented in the S&P 500 as of Jan. 22: Financials 18.2%Information technology 18.2%Health care 14.4%Consumer discretionary 12.9%Industrials 10.9%Consumer staples 8.4%Energy 6.1%Telecommunications 5.3%Utilities 3.1%Materials 2.5%Source: Standard & Poors

9. Index earnings • The all time S&P 500 high was March 24, 2000 at 1552.87 • The lowest drop since that date was October 9, 2002 at 777. • How much money would your client have lost? • What is the S&P 500 today?

10. Index earnings • Here is an example on how to calculate an index earnings. On Feb 6, 2004 the S&P500 closed at 1142.76 One year later, the S&P500 closes at 1284.56 1284.56 -1142.76 141.80 / 1142.76 =12.41%

11. Participation rate 100% • What you see is what you get!! • All loads were taken out at the beginning of the portfolio period, therefore you have 100% guaranteed participation. • The participation is guaranteed!

12. Cap Rates Today are 12% & 30% • 100% participation rate guaranteed • A 4% to 8% minimum annual cap guaranteed based on strategy • Annual caps set in advance on segment anniversary • Cap managed on a portfolio basis • Cap rates will primarily raise and fall according to interest yield on bonds New premium and segment renewals move together.

13. Equity Indexed StrategyIllustrated Rate Basis • 53 year look-back of historical S&P • January 1950 - December 2003 • Performance results: One Year cap 12% cap 7.90% Two Year cap 30% cap 8.30% • Less volatility in illustrated rate 1% change in cap only effects illustration .4% Note: The actual credited rate can be higher or lower, and will be based on actual S&P 500 index movement. Unlike the illustrated rate, the actual credited rates are likely to vary from year to year.

14. Segments for premium $ BasicInterestStrategy at 4.75% (NET OF SALES CHARGES and COI’S) 0ne-YearFixed TermStrategy at 4.5% Five-YearEquity IndexedStrategy at 7.9% SIX-Year Equity IndexedStrategy at 8.3% One Year Five Years SIXYears MaturedValue MaturedValue MaturedValue

15. “Before You Say” “It is too risky of a product for my Client” Let’s look at the Guarantees

16. The Six Value-Added Guarantees • Policy values protection • Annual lock-in of index gains • Annual Reset • Guaranteed credited rate • Life Protector Rider • No Lapse Guarantee Rider • Even with a guaranteed conditional pay period

17. Key Question To Ask • To A Potential Fixed UL Buyer • Are you comfortable risking the 1-2% (a potential 3-4% vs. 2% guaranteed) in exchange for the potential to earn up to 12% each year or 30% over two years? • To A Potential Variable UL Buyer • Are you willing to give up the potential gains over 12% each year or 30% every two years in order to protect your principal, lock-in the gains every 12 or 24 months, and secure a 2% guarantee?

18. Two types of Loans • Zero-Net cost loan (Preferred loan) • Variable loan - This loan is from the company using your policy as collateral. Your policy earns at the index rate, while the company charges a variable loan.

19. “Before you say” “It doesn't fit the market I’m in.” Let’s look at the markets these products are being used in

20. Four Major Markets • Accumulation plans 1.Provides living benefits 2. Retirement plans 3. College funding • Guaranteed Death Benefit and Premium Sales • Single Premium Sales • Rescue sales

21. Seven Sales Ideas • Single pay, better than an annuity? • Start Cheap, Educate, Retire, leave a Legacy • Be Your Own Banker!! • Take it to the Max! • A Grandparent’s Choice • 1035 Rescue of a dying policy with a loan. • Various Financial Alternatives

22. Single Pay, better than an Annuity? • Situation • 62 year old female, preferred non tobacco • Wants to convert a jumbo CD of $100,000 to an annuity. • However would consider a permanent, guaranteed death benefit until age 100 to pass on to her heirs. • May want to withdraw funds in the future

23. Guaranteed Death Benefit

24. Automatic Death Benefit Extension To 115.

25. Guaranteed Rate of Return

26. IRR stays high on a pre-tax basis

27. Guaranteed D.B. 95% of cash value taken out Life Protector Rider

28. Start Cheap, Educate and Retire, and leave a Legacy • 30 yr old man with a 3 yr old son • Needs $400,000 of life protection • Wants to have money 15 years from now for college • Want to have a retirement plan.

29. Low cost beginning No tax outlay $22,000 for 4 years

30. $65,000 tax free fo 20 years.

31. Total input Total outtake Death benefit In his nineties

32. Be your Own Banker • There are several methods to achieve this goal • This example shows how a 35yr. old man can buy two luxury cars, in his life time, pay himself back, and increases his retirement. • You can design the same, with an understanding on how to create repayments, which most of your competition can’t.

33. Two car loans

34. $115,000 tax Free for 20 yrs.

35. Take it to theMax! • Many sales scenarios look at minimum premium • Let’s look at the benefits of taking that minimum premium and funding on a maximum basis • Let’s look at a Female Age 35, $200,000 death benefitfirst paying minimum,then paying maximum • Review Internal Rateof Return on thePremium Difference

36. Initial Outlay $1,289

37. Age 65 Cash Value$82,590

38. Initial Outlay$2,741

39. Age 65 Cash Value$285,445

40. Let’s Look at the Numbers Internal Rate of Return: 9.1%

41. Taking it to the Max! Receive the entire 9.1% in a lump-sum,($202,507) tax free! WOW!

42. A Grandparent’s Choice • Grandparents are always looking to provide their grandchildren with unique gifts • Why not insure the mother after birth with the grandparents annual gift exclusion. • Provides protection for the child and a wonderful college fund.

44. A 1035 rescue of a dying policy with a loan • We have a 60 yr. old male who has a $1,000,000 policy that has $200,000 of cash value, but also has a $100,000 loan against it. • He would like to not pay any more premium, but is worried about the policy lapsing and owing tax. • Could we help him with our new LPR?

45. A 1035 exchange for $1,000,000 of original coverage The D.B. begins to decline under the weight of the loan and mounting interest The cash value in the exchange is $200,000 with a loan of $100,000

46. The policy will lapse under the current assumptions at age 85

47. However, by using the new LPR, we can rescue this 1035 exchange and guarantee the policy will never lapse!