1. 1 AFLAC | WORKFORCES REPORT The Role of Voluntary Insurance in the New Health Care Landscape Tye Elliott, VP Aflac Core Broker Sales

2. 2 AFLAC | WORKFORCES REPORT Today’s health care environment Impact on employers and employees The broker’s role Benefits of voluntary insurance The path toward voluntary insurance

3. 3 AFLAC | WORKFORCES REPORT Where are we on the health care reform journey?

4. 4 AFLAC | WORKFORCES REPORT Health care costs are continuing to rise Companies are cutting costs A comprehensive benefits package now more important to employees Situation Analysis

5. 5 AFLAC | WORKFORCES REPORT Current realities: Rising health insurance costs Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 2003-2013 Average Annual Health Insurance Premiums and Worker Contributions for Family Coverage 2003-2013

6. 6 AFLAC | WORKFORCES REPORT Companies looking to offset financial pressure caused by rising health care costs Employers are shifting costs to employees 56% of companies increased employees’ co- payments and/or employees’ share of premiums

7. 7 AFLAC | WORKFORCES REPORT Employees looking at benefits packages as safety nets Emphasis on a well-rounded, comprehensive benefits package 6 in 10 of today’s employees would be willing to take a job with lower pay, but better benefits

8. 8 AFLAC | WORKFORCES REPORT How does the current health care landscape affect brokers? 8 AFLAC | WORKFORCES REPORT Use of brokers is growing –From 2011 to 2014, employers use of brokers grew from 56% to 64%

9. 9 AFLAC | WORKFORCES REPORT 2014 is the year for voluntary benefits

10. 10 AFLAC | WORKFORCES REPORT Employees concerned about rising costs 86% believe the expenses they are responsible for will continue to rise Only 16% feel their benefits package meets the needs of their family 76% want more benefits options 35% are just SOMEWHAT SATISFIED with benefits; 11% NOT AT ALL satisfied Workers Not Feeling Protected

11. 11 AFLAC | WORKFORCES REPORT A robust benefits offering no longer stops with the “usual suspects”

12. 12 AFLAC | WORKFORCES REPORT Desire for voluntary benefits 63% of employees today see a need for voluntary insurance 76%: Because of increasing medical costs 51%: Because of changes due to reform 66%: Because of rising coverage costs

13. 13 AFLAC | WORKFORCES REPORT What is voluntary insurance? Complements major medical insurance Designed to help pay for out-of-pocket expenses Policies include accident, disability, cancer, hospital, critical illness and many more

14. 14 AFLAC | WORKFORCES REPORT Voluntary polices = Cash benefits Aflac’s policies pay policyholders directly for costs associated with a covered serious illness, injury or loss Cash benefits can be used for rent, gas, groceries, child care or any other out-of-pocket expenses

15. 15 AFLAC | WORKFORCES REPORT Brokers seeing advantages of voluntary insurance Brokers who offer voluntary are 35% more likely to be increasing the number of their clients Brokers who offer voluntary are 12% more likely to be maintaining and/or increasing sales 64% say they offer voluntary to satisfy needs of their clients’ employees

16. 16 AFLAC | WORKFORCES REPORT The voluntary advantage

17. 17 AFLAC | WORKFORCES REPORT The Pitch: Everyone wins with voluntary Benefits impact workers and the bottom line Cost-effective way to offer employees more protection Additional revenue stream for brokers Bottom line: Good business for all

18. 18 AFLAC | WORKFORCES REPORT Benefits options are important for recruitment and retention 85% of workers say their benefits package is at least somewhat influential on their overall job satisfaction 63% say a benefits package is important to their work productivity

19. 19 AFLAC | WORKFORCES REPORT Voluntary benefits affect workers’ job satisfaction 23% of employees are enrolled in voluntary benefits programs +19% less likely to look for a new job +38% more likely to be satisfied with their benefits programs +18% more likely to be extremely/very satisfied with their jobs

20. 20 AFLAC | WORKFORCES REPORT Impact of voluntary benefits Have more than $1,000 in savings Have peace of mind Health insurance is important part of financial plan Have a financial plan Confident in financial future

21. 21 AFLAC | WORKFORCES REPORT Employees enrolled in voluntary feel more confident A majority of employees name “personal financial issues” as the No. 1 non-work-related issue distracting them while on the clock Those enrolled in voluntary are 10% more likely to have peace-of-mind

22. 22 AFLAC | WORKFORCES REPORT Benefits: Best-in-class companies Source: 2011 Employer Survey on Purchasing Value in Health Care Report by Towers Watson

23. 23 AFLAC | WORKFORCES REPORT Providing a wide range of benefits doesn’t have to cost a dime

24. 24 AFLAC | WORKFORCES REPORT Looking forward

25. 25 AFLAC | WORKFORCES REPORT Employers are looking to brokers for guidance

26. 26 AFLAC | WORKFORCES REPORT 85% satisfaction 78% decision to leave 73% refer a friend 83% loyalty Voluntary matters because benefits matter INFLUENCE OF BENEFITS PACKAGE

27. 27 AFLAC | WORKFORCES REPORT In conclusion… Employers are taking cost-cutting measures Employees feel financially unprotected as health care costs are shifted to them Brokers need to balance clients’ goals and employee needs The solution is voluntary benefits

28. 28 AFLAC | WORKFORCES REPORT THANK YOU