1. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. TMK1536 060811 Compensation Dolores Skarjune Vice President Agent training only. Not for sales use.

2. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. I.Home Office Contacts II.Commission Cycle III.Production Bonus Cycle IV.Minimum Standards V.Questions Agenda

3. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Liberty Commission Team LNL Commissions Jan Adams Commissions Betty Woods Joseph Hall Bonus Production Pat Burton Jane Hampton Debit Balance/Vector & Settlement Donna Portera Income Floor / Group Moves/ UMIT Brenda Wilkinson 3

4. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Friday: Submission cut-off is 3:30 p.m. central time Saturday – Tuesday: Adjustments occur Tuesday Evening: Commissions finalized Wednesday: Reports are published Friday: Payday Commissions Cycle Calendar May SunMonTuesWedThursFriSat 301 2345678 9101112131415 16171819202122 23242526272829 3031 4

5. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. compensation Commission Reports www.libertynational.com

6. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. compensation Commission Reports www.libertynational.com

7. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: Commission Account Statements Weekly Report CC200002

8. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. compensation Commissions Reports www.libertynational.com

9. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: Renewal Statements Weekly Report CC200003 (CC200023)

10. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. compensation Commissions Reports www.libertynational.com

11. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. compensation Reports: Transaction Register Weekly Report CC172001 (5-Digit Branches Use Production Register CC170002)

12. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: Transaction Register Annual Premium & Adjustments Columns Reflects increase or decrease in Agent’s in-force AP that affects growth Reflects modifications which may need to be made to ensure items are listed correctly  Example: policy incorrectly credited to an Agent — reflected in the adjustment column Certain policies (like $3,000 accident policy, dental, vision) do not credit growth — will show up in the Adjustment column

13. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. compensation Commissions Reports www.libertynational.com

14. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: Field Earnings Statements Weekly Report PY132003 (PY132005)

15. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Commissions: Standard Comp Rules Commissions are paid once a week Maximum Submit Advance on any one policy is $300 After an Agent has been appointed for 13 weeks, if the Commission Account balance falls below $500, the Direct Pay Submit Advance will be reduced by half Agent weekly Direct Pay Percentage from the commission Account is dependent on the balance of the account Less than $3,0006% $3,000 - $4,0008% $4,000 +10% Unit and Branch Mangers receive 8% from their commission account weekly

16. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Commissions: Standard Comp Rules A negative commission account balance will have earned commission applied to commission account Business written on persons related to the Agent by blood/marriage will not receive direct pay submit advance or bonus Unit Managers and Branch Managers receive Direct Pay in the same manner as Agents, but only on Agents in their first 52 weeks of employment.

17. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Direct Pay Submit Advance DCNBB/AnnualSection 125 All Other Modes 0-1370%50%0 14-1755%40%0 18+40%30%0 May be reduced based on the Agent’s DCN.

18. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Commissions: FAQ 1.What happens when there are returned drafts? 2.What happens when there is a COD policy? 3.What happens when the Agent is unlicensed and commissions are assigned to them?

19. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Friday: Submission cut-off is 3:30 p.m. central time Saturday – Tuesday: Adjustments occur Tuesday Evening: Commissions finalized Wednesday: Reports are published Friday: Payday Commissions Cycle Calendar May SunMonTuesWedThursFriSat 301 2345678 9101112131415 16171819202122 23242526272829 3031

20. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. TMK1536 060811 Questions Agent training only. Not for sales use.

21. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. TMK1536 060811 Production Bonus Agent training only. Not for sales use.

22. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Production Bonus Cycle Calendar Friday: Submission week end cut off at 3:30pm. Saturday – Tuesday: Adjustments are made to Gross Submit to determine Net Submits Wednesday: Bonus Detail Report is published Wednesday – Tuesday: Adjustments are made to Gross Submit to determine Net Submits Tuesday Evening: Bonus finalized on Net Submit Friday: Payday May SunMonTuesWedThursFriSat 301 2345678 9101112131415 16171819202122 23242526272829 3031

23. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. compensation Production Bonus Reports www.libertynational.com

24. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: Bonus Detail Report Weekly Report CC340504 & CC340505

25. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. compensation Production Bonus Reports www.libertynational.com

26. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: Adjusted Bonus Detail Report Weekly Report CC341504 & CC341505

27. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. compensation Production Bonus Reports www.libertynational.com

28. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: UM & BM Bonus Detail Weekly Report CC342003: LNL Unit Manager Weekly Report CC342007: LNL Branch Manager

29. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: Bonus Deferral Weekly Report CC341002: LNL Unit Manager Weekly Report CC341003: LNL Branch Manager

30. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: Bonus Deferral (Agent’s View) Weekly Report CC341006:

31. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: Bonus Deferral (Agent’s View) Weekly Report CC341007:

32. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: SAMS Messages Cancels / Declines

33. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: SAMS Messages Stop Pay

34. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. compensation Production Bonus Reports www.libertynational.com

35. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: Field Earnings Statements Weekly Report PY132003 (PY132005)

36. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Production Bonus: Standard Comp Rules Consecutive Weeks Gross Submit $1,050 Annual Premium Production Bonus % 00% 110% 220% 330% 4+40%

37. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Example Agent Production Bonus Percentage. Week Gross Submit Bonus % 1.$ 1,050 10% 2.$ 1,050 20% 3.$ 1,050 30% 4.$ 1,050 40% 5.$ 900 0 6.$ 1,050 30% 7.$ 1,050 40%

38. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Example Agent Production Bonus Percentage. Week Gross Submit Bonus % 1.$ 1,050 10% 2.$ 1,050 20% 3.$ 1,050 30% 4.$ 1,050 40% 5.$ 900 0 6.$ 900 0 7.$ 1,050 10%

39. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Production Bonus: Standard Comp Rules Bonus percentages depend on # of consecutive weeks Agent qualifies for Bonus 1st Time 40% Bonus Earner’s get Double Bonus Agents who maintain 40% for an additional 8 consecutive weeks get Double Bonus NOTE: An Agent can only receive each of these double bonuses one time.

40. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Production Bonus: Standard Comp Rules 1.DCN or Persistency minimum requirements No bonus paid with DCN rates higher than 20% No bonus paid with Persistency rates lower than 65% 2.Minimum $1,050 gross annual submitted premium 3.Agents Contracted Oct. 5, 2009, or later 25% of earned Bonus deferred to 8th month Deferred Bonus deposited into Commission Account No Deferral after 8 th month

41. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Production Bonus: Standard Comp Rules Unit Manager is eligible for a weekly production bonus that is a percentage of any weekly production bonus received by an Agent on the Unit Manager’s group. The percentage will depend on the number of 1st time 40% bonus earners during the previous 8 weeks and the Agent’s length of service. UM’s Bonus Override % of Agent’s Bonus

42. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Production Bonus: Standard Comp Rules The All-Agent’s All Business DCN Production Bonus Multipliers will be used to calculate the bonus until the Agent’s 7 th month. We will begin using the All-Agent’s All Business Persistency Production Bonus Multipliers for agents assigned 8 months or longer. The Unit Manager’s bonus override % is based on the number of first time 40% bonus earners and calculated every Friday. If a Unit Manager submits an application for personal commission credit, no Production Bonus is payable to the Unit Manager.

43. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Production Bonus: Standard Comp Rules DCN & Persistency rates determine Production Bonus Multipliers Month 1 – 3: Agents use a DCN multiplier of 1.0 Month 4 – 7: DCN is used to determine multiplier Month 8: Persistency rate is used to determine multiplier DCN and Persistency calculated on the 24 th and use for bonus purposes The multiplier is applied to business submitted the week following the report on the 24 th for the next month

44. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. DCN & Persistency Production Bonus Cycle

45. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: DCN – All Agent for Bonus Monthly Reports AL566

46. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: Persistency – All Agent for Bonus Monthly Reports AL566

47. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Production Bonus Cycle: FAQ DCN Wrong Agent Numbers DCN / Persistency multipliers E-App uploads Cut-Off

48. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Production Bonus Cycle Calendar Friday: Submission week end cut off at 3:30pm. Saturday – Tuesday: Adjustments are made to Gross Submit to determine Net Submits Wednesday: Bonus Detail Report is published Wednesday – Tuesday: Adjustments are made to Gross Submit to determine Net Submits Tuesday Evening: Bonus finalized on Net Submit Friday: Payday May SunMonTuesWedThursFriSat 301 2345678 9101112131415 16171819202122 23242526272829 3031

49. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. TMK1536 060811 Questions Agent training only. Not for sales use.

50. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. TMK1536 060811 Compensation Examples Agent training only. Not for sales use.

51. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Example 1 Agent Commission Account above $500

52. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. 614.87 2 432.71 2 1 2 3 4 21 4 3 4

53. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations.

54. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. $635 x 40% = $254 $254 x 25% = $ 64 $254 - $64 = $190 $190 x 1.09 = $207 32 1 1 44

55. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations.

56. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. 56

57. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations.

58. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations.

59. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations.

60. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations.

61. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. 61

62. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations.

63. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations.

64. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations.

65. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations.

66. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations.

67. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. 67 No Bonus will be paid to Agents with QOB rates lower than 54%

68. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. 68

69. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Questions Branch Managers with questions regarding Liberty National commissions or bonuses should e-mail Customer Service:  CUSTSERV@LIBNAT.COM  DO NOT e-mail or telephone an employee or department manager directly.

70. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Questions The e-mail to Customer Service must include the following information: Subject Line – Commission/Bonus question from Branch Number and Agent Number

71. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Questions The e-mail to Customer Service must include the following information: Body – The body of the E-mail must include the following: a.Branch Manager name and number b.Agent Name and number c.Timeframe when situation occurred (submit week) d.Policy numbers and/or application numbers e.Complete description of commission or bonus issue f.Copies of all E-mail strings regarding your request

72. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Escalation If an issue has not been resolved in 48 hours, Branch Managers should escalate their request to Susan Huff  SHUFF@LIBNAT.COM PLEASE BE SURE TO INCLUDE COPIES OF ALL E-MAIL STRINGS REGARDING YOUR REQUEST.

73. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. TMK1536 060811 Liberty Minimum Standards Administered in McKinney, Texas Department is headed by Tasha Hukee Agent training only. Not for sales use.

74. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Liberty Minimum Standards DCN Rate must be 20% or lower Persistency Rate must be 65% or greater Minimum First Year Agent premium issued on 13-week average  Agent$320  UM$800  BM$1,600 Agents must issue one net policy every eight weeks Failure to meet any of these minimum standards may result in termination

75. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Reports: Minimum Production Standards Qlikview Minimum Standards Dashboard

76. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Liberty Minimum Standards – DCN Report Monthly AL566 All Business, All Agents Reports

77. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Liberty Minimum Standards 3-Month DCN September 25 October 24 November 24 December 24 January 24 January 25 1 2 3 Submitted Business 1 23 DECLINES, CANCELLATIONS, NOT TAKENS 4 Reports Published DCN Calculated

78. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Liberty Minimum Standards – Persistency Report Monthly AL566 All Business, All Agents Reports

79. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Liberty Minimum Standards 3-Month Persistency MayJuneJulyAugSeptOctNovDecJan 24 Jan 25 Persistency Calculated 1 23 Issued Business Reports Published

80. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Liberty Minimum Standards For DCN: Warning letters are sent the month the Agent is below standards (DCN greater than 20%) Agent is given 3 months to bring DCN to acceptable level During this time, monthly letters are sent informing the Agent whether they are making progress Agents failing to meet DCN standards are subject to termination

81. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. Liberty Minimum Standards For Persistency: Warning letters are sent the month the Agent is below standards (Persistency less than 65%) Agent is given 6 months to bring their Persistency to acceptable level During this time, monthly letters are sent informing the Agent whether they are making progress Agents failing to meet Persistency standards are subject to termination

82. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. TMK1536 060811 Questions Agent training only. Not for sales use.

83. TMK1536 060811 For Agent Training use only; not approved for use in sales presentations. What have you put on your To Do List? TMK1536 060811Agent training only. Not for sales use.