Submitting Insurance Business: The Underwriting Process

Why Offer Insurance? 85 percent of consumers agree that most people need life insurance, yet just 62 percent say they have it. 44 percent of U.S. households had individual life insurance as of 2010 — a 50-year low. In 1960,72 percent of Americans owned individual life insurance. In 1992, 55 percent owned it. 40 percent of Americans who have life insurance coverage don’t think they have enough. 70 percent of U.S. households with children under 18 would have trouble meeting everyday living expenses within a few months if a primary wage earner were to die today. 4 in 10households with children under 18 say they would immediately have trouble meeting everyday living expenses. $15.3 trillion: Estimated unmet life insurance need in the United States 83% of consumers say they don’t purchase more life insurance because it’s too expensive, but consumers believe life insurance costs nearly 3 times the actual price. LIMRA survey FOR INTERNAL USE ONLY

Protection is Key! Insurance is the BASE of the financial pyramid… We need to have the conversation with EVERY client! 3 FOR INTERNAL USE ONLY

Obstacles? CHALLENGESOLUTION Not comfortable with concepts/products Insurance Marketing Specialists/training Don’t want to be “insurance agent” Protecting your clients’ plans & future Paperwork is too difficultTele-application process / eApps Medical questions are too invasive No time 4 FOR INTERNAL USE ONLY

What is Underwriting? Insurance underwriters evaluate the risk and exposures of potential clients. They decide how much coverage the client should receive, how much they should pay for it, or whether even to accept the risk and insure them. 5 FOR INTERNAL USE ONLY

The Process at a Glance 6 Submit formal application Client completes paramed Application Insurer orders add. records Underwriter reviews case Underwriting Offer for insurance / decline Acceptance / return of del reqs Offer/Acceptance FOR INTERNAL USE ONLY

Setting Expectations - Timeline Underwriting can take 10 days (for the new simplified, express ticket qualified cases) to a year (for the VERY complicated cases with significant health history.) Prompt response to outstanding requirements and underwriting questions can make a world of difference in issue time! 7 FOR INTERNAL USE ONLY

Commonly Requested by Carriers Prescription database searches Physician records (APS) Motor vehicle reports MIB (Medical Information Bureau) search Tax transcripts from IRS Routine blood tests (kidney, liver, lipid levels, HIV, diabetes) Urine tests (smoking, drug use, medications) 8 FOR INTERNAL USE ONLY

Statistics Roughly 78% of the applications our Advisors submit are fully underwritten and placed 90% of applicants are offered Standard or better rates LTC applicants have the highest decline percentage Disability applicants are often rated and/or given exclusions of coverage Outstanding medical records are the single biggest bottleneck to efficient underwriting 9 FOR INTERNAL USE ONLY

Common Underwriting Issues – Height/weight – Diabetes (or pre-diabetic – High blood pressure / high cholesterol – Smoking (often undisclosed) – Sleep apnea – Depression or other mental issues – Undisclosed medical conditions – Treatment plans which are in progress (e.g. pending surgery or diagnostic testing) – Previous declines for long-term care insurance 10 FOR INTERNAL USE ONLY

Why Work with HD Vest Insurance? Top-rated carriers Marketing support team Great payout with core carriers Commissions increase your overall rolling gross Tele-application available to complete paperwork Tools like electronic applications (term ins) and remote capture New business team to review paperwork prior to submission Case management team to shepherd application through UW process HDV orders paramed exams and doctors’ records for Advisor 11 FOR INTERNAL USE ONLY

Who Do I Call? WEALTH MANAGEMENT SUPPORT CONSULTANT: Help on basic product information/quotes INSURANCE LICENSING: Initial insurance license or nonresident licenses; carrier appointment questions, continuing education and product training questions INSURANCE CASE MANAGEMENT TEAM: Questions on pending applications; help filling out paperwork; reschedule requests for tele-underwriting appointments; post-issue customer service questions for non-annuity business 12 FOR INTERNAL USE ONLY

What to Expect? Submit application to HDV HDV opens CSL and orders requirements Application submitted to carrier Case manager at HDV works with UW Notes on case progress posted to CSL Receive offer from underwriter Once accepted, policy mailed HDV reviews policy; mails to Advisor Requirements to place coverage in force returned to HDV for forwarding 13 FOR INTERNAL USE ONLY

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Core Carriers 15 FOR INTERNAL USE ONLY

Tele-Application Service 16 FOR INTERNAL USE ONLY

17 Click on a BLUE block to schedule an interview FOR INTERNAL USE ONLY

Tele-Application (continued) 18 Verify the time selected is correct Complete all the blocks and select the product type Click the “Save and Continue” button at the bottom of page IMPORTANT: Do not use your back button to come back to this screen as it will lock the tool and not allow anyone in to make changes for minutes FOR INTERNAL USE ONLY

Tele-Application (continued) 19 Complete information (questions based on product type selected on previous screen) and click on “SUBMIT PREAPP” button to secure appointment time FOR INTERNAL USE ONLY

Tele-Application (continued) 20 Using your mouse, right click on this page to print the confirmation (which includes information on the interview and paramed process) for your client If you need to CHANGE THE DATE/TIME of the appointment, please call HD Vest Insurance to avoid reentering information (also call if you need to make changes to the input data) If you need to CANCEL the appointment, please click on the “My Underwriter Appointments” link FOR INTERNAL USE ONLY

Accessing/Submitting Documents 21 To access paperwork for tele-applications: Login in to HDV Link Go to Advisor Center > Document Search Search using the date the paperwork was uploaded (as noted in the CSL ticket) To SUBMIT new applications or documents for cases pending in underwriting: Go to Advisor Center > Remote Capture Click on Launch Remote Capture Click on green New Batch button Scan or upload your documents Select Insurance for Content Type Select batch type from drop down menu Click on Submit button PLEASE NOTE: Checks may not be submitted via Remote Capture. Some paperwork must also be submitted in original form. We will let you know if originals are required. FOR INTERNAL USE ONLY

Electronic Applications and Policies Carriers available using iGO tool on *Banner Life (LGA) (AppAssist) John Hancock Life Lincoln Financial Group *MetLife (Express Order Ticket) Mutual of Omaha / United of Omaha (Speed e-Ticket) Nationwide Principal Financial *Protective Life (TeleLife) Prudential VOYA (Term App Express) American General also has a proprietary tool – Quick Ticket – available at Electronic applications can save 1-2 weeks in underwriting, reduce or eliminate NIGO issues, and provide a better experience for the agent and client. 22 FOR INTERNAL USE ONLY

Takeaways Set appropriate client expectations Let HDV Insurance help Use electronic tools when available Check your CSLs often for updates or requests Stay engaged – coach your client Finish the deal! 23 FOR INTERNAL USE ONLY

HD Vest Financial Services ® is the holding company for the group of companies providing financial services under the HD Vest name. Securities offered through HD Vest Investment Services SM, Member SIPC Advisory services offered through HD Vest Advisory Services SM 6333 N. State Highway 161, Fourth Floor, Irving, TX FOR INTERNAL USE ONLY