Secure Lifetime GUL 3 with Asset Protector

Secure Lifetime GUL 3 with Asset Protector
Life insurance you don't have to die to use Secure Lifetime GUL 3 with Asset Protector Live Longer. Retire Stronger. Accelerated Access Solution® Lifestyle Income Solution® Presented by… Policies issued by American General Life Insurance Company, a member company of AIG For this brochure to be complete for California residents, they must be provided the “California Resident Supplemental Information” flyer on the Accelerated Access Solution (AGLC108547)

Agenda I’d like to describe how
American General Life is revolutionizing the way life insurance is bought and sold By showing how you can turn illiquid death benefits into a liquid pool of money your clients can use to protect their portfolio assets from the costs of severe illness and the risk of outliving their assets Here is what is on the agenda for today’s discussion. I’d like to describe how American General Life is revolutionizing the way life insurance is bought and sold. By showing how you can turn illiquid death benefits into a liquid pool of money your clients can use to protect their portfolio assets from the costs of severe illness and the risk of outliving their assets. So they can achieve a higher sense of financial security during their retirement. So they can achieve a higher sense of financial security during their retirement.

One of Three Things Will Likely Happen
During the ownership of a universal life insurance policy one of three things will likely happen to the policy owner/insured. They will die too soon, become seriously ill, or potentially outlive their retirement assets.

Here is the financial life spectrum
Here is the financial life spectrum. Most people go through three phases. They are either building assets, protecting assets or trying to extend their assets. Now with American General Life’s Asset Protector we can mitigate all three potential risks during each of these phases of the financial life spectrum. Whether that be dying too soon, getting sick along the way or living too long. Let’s look at the first prong of protection of the Asset Protector which is Life Insurance which is designed to protect an individual from dying too soon.

Level premium data generated on 10/10/2016 for the state of Colorado.
New and Improved Features & Pricing Even in this low interest rate environment AIG remains committed to the Guaranteed Universal Life (GUL) market and continues to offer competitive premiums, targets and guarantees especially when guaranteeing to ages between 100 and 110. Its greatest premium strength is in continuous-pay and 10-pay scenarios performing best for issue ages 55 and older. Return of Premium (ROP) enhancements – 2 ROP opportunities (via the Enhanced Surrender Value rider) are automatically included in the policy Level premium data generated on 10/10/2016 for the state of Colorado.

Guaranteed Premiums and Death Benefits
Secure Lifetime GUL 3 100% ROP at Age 85 50% ROP at Policy Year 20 100% ROP at Policy Year 25 The first aspect of the Asset Protector is the Secure Lifetime GUL 3. This is the life insurance policy that provides protection against dying too soon. Above and beyond just the life insurance protection this policy also provides some other benefits. First both the death and premium amounts are guaranteed. Which means the life insurance policy will not lapse as long as the client pays the required guaranteed premium. Additionally this policy also builds up guaranteed cash value that the client can access if needed. Built into the Secure Lifetime GUL 3 policy is a no-cost rider called the enhanced surrender value rider. This rider allows the insured to surrender their policy at the end of the 20th policy year and receive back 50% of their premiums paid. The Asset Protector also has a 100% return of premium option beginning at the age of 85 which I will explain in more detail a little later in the presentation. Guaranteed Cash Value Guaranteed Premiums and Death Benefits

Male, age 65, PNT, guaranteed to 1051
Secure Lifetime GUL 3 Flexibility & Choice Male, age 65, PNT, guaranteed to 1051 Guarantee Period Face $1M, guaranteed to 105 Annual Premium2 $21,056 Guaranteed Cash at 85 $138,974 Face $500,005 guaranteed to 121 Annual Premium $12,360 Guaranteed Cash at 853 $77,683 50% Withdrawal at 85: $69,486 Here’s an example of how AG Secure Lifetime’s unique partial withdrawal feature allows your clients to access cash while preserving their death benefit guarantee. In this example, a male, age 65, SNT, $1M death benefit guaranteed to age 105 will pay an annual premium of $21,056. At age 85, the policy has accumulated $138,974 of guaranteed cash. Due to life circumstances, the policy owner chooses to withdrawal 50% of the cash value – or $69,486 – at age 85. The guaranteed death benefit reduces proportionally to $500K, the annual premium reduces proportionally to $12,360, and the guaranteed cash value reduces proportionally to $77,683. The guaranteed death benefit after a withdrawal is unmatched in the marketplace. Unique Partial Withdrawal Capability Allows You To Access Cash and Preserve Death Benefit Guarantee Not an actual case. Presented for illustrative purposes only. Quote dated 10/13/2016 for the state of Texas. The reduction in specified amount will be subject to the same guidelines and restrictions as outlined in the policy. The resulting remaining death benefit amount must be no less than $50,000.

Quote dated 10/13/2016 for the state of Texas.
Guaranteed Return of Premium (ROP) Enhanced Surrender Value Rider 50 M PPNT $1M DB Level Pay to Age 105 Cover how the illustration example of the ROP is now dynamic. Quote dated 10/13/2016 for the state of Texas.

Quote dated 10/13/2016 for the state of Texas.
Quotation Example Highlight how the illustration displays the 2 ROP options. Quote dated 10/13/2016 for the state of Texas.

The next prong of protection the Asset Protector provides is the chronic illness rider which can protect the assets of an insured if they get sick along the way due to a chronic illness.

Accelerated Access Solution
101(g) No LTC license necessary 2-out-of-6 ADLs; or Severe Cognitive Impairment No Longer Required to be Permanent* Indemnity Benefit No Receipts Spend benefits on anything Flexible Benefit Base Benefit = 50% up to 100% of Death Benefit $50,000 minimum up to $3,000,000 maximum Full waiver of monthly deductions Let’s look at some of the benefits of the Accelerated Access Solution. Accelerated Access was filed as a rider under IRC section 101(g). That primarily means that: No LTC license is required for you to be able to sell the Accelerated Access Solution as part of an AG Secure Lifetime GUL II policy. Your Life Insurance and Accident & Health licensing is all that’s necessary from a licensing standpoint. It also means that the primary triggers for Chronic Illness benefits are either (1) inability to perform 2-out-of-6 Activities of Daily Living (ADL’s); or (2) severe cognitive impairment. The benefit was filed as an Indemnity benefit. That’s completely different than the alternative – the Reimbursement benefit. With Reimbursement, you must file a claim and provide copies of all invoices. Your claim is reviewed and, eventually, you receive a reimbursement in an amount the insurance company deems appropriate based on your receipts. With American General Life’s Indemnity version, you don’t need to provide an receipts or file any claims regarding your treatments. American General Life will send your benefit checks every month, regardless of whether you’ve incurred any costs at all, and regardless of what those costs were. You meet the criteria for ADLs or severe cognitive impairment, file your claim and satisfy the 90-day waiting period, and American General Life begins sending the checks. *Connecticut Chronic Illness Accelerated Death Benefit Rider Requirements ( ) Chronic Illness in the state of Connecticut is defined as the insured being certified, within the previous12 months, as suffering a medically determinable condition which results in their being considered unable to perform 2 of 6 Activities of Daily Living, or requiring substantial supervision. Further, as a result of this condition, the insured must have been confined for at least six months in their place of residence or in an institution that provides necessary care or treatment of an injury, illness or loss of functional capacity. Finally, it must have been medically determined that the insured person is expected to remain confined in such place of residence or institution until death. 13

Benefits of Accelerated Access Solution: Chronic Illness
Flexible Monthly Benefit IRS Per Diem capped at 2% per month IRS Per Diem capped at 4% per month IRS Per Diem with No Cap! Max. Monthly Benefit = Total Benefit ÷ 12 Monthly benefit: American General Life will always pay up to the maximum IRS monthly Per Diem benefit, but you have a choice of three different caps on the maximum monthly benefit American General Life will pay. 2% of the AAS Benefit Base. With this option, if you had an Accelerated Access Solution aggregate benefit of $500,000, your monthly maximum benefit would be the lesser of: (a) the IRS monthly Per Diem; or (b) $10,000 per month. 4% of the AAS Benefit Base. With this option, if you had an Accelerated Access Solution aggregate benefit of $500,000, your monthly maximum benefit would be the lesser of: (a) the IRS monthly Per Diem; or (b) $20,000 per month. If you don’t choose to cap your monthly benefit at 2% or 4%, and assuming the same aggregate $500,000 Accelerated Access Solution benefit, the maximum monthly benefit will be the lesser of: (a) the IRS monthly Per Diem; or (b) $500,000 divided by 12 months = $41,666 per month. So, choose your aggregate benefit, and your monthly cap, and you’ll be ready to go! IRS caps the maximum daily rate each year. The 2017 maximum is $360/day or $10,950/month. Subsequent years may be higher. *Maximum monthly benefits limited to IRS per diem in effect at time of claim 14

Benefits of Accelerated Access Solution
Inflation hedge against future costs Purchase more than today’s Per Diem limit Many products won’t allow it Provides inflation protection with a maximum monthly benefit cap 4% Cap – example: 4% of $300,000 = $12,000 per month Go on-claim in 2017: Collect $10,950 per month Go on-claim in the future when Per Diem = $15,000 per month: Collect $12,000 per month Per Diem – example: $300,000 AAS benefit Maximum monthly benefit: $300,000 = $15,000 per month For clarification, here are a few more examples. With Accelerated Access Solution you can actually purchase more than today’s Per Diem limit. There are products on the market that won’t let you purchase a benefit in excess of the current year’s Per Diem limit, which means your benefit will never go up, regardless of an increasing, inflation adjusted Per Diem. Because AIG allows you to purchase an aggregate amount and a monthly benefit amount in excess of the current Per Diem, the outcome is very simple. At lower Per Diem amounts you get less per month, but for more months. At higher Per Diem amounts you get more per month, but for fewer months. Let’s look at another example using a 4% cap. If you purchased a $300,000 Accelerated Access Solution benefit, your maximum monthly benefit would be $12,000. Accelerating $12,000 per month would be able to continue for 25 months ($300,000 ÷ 12 = $25) If you went on-claim in 2017 you’ wouldn’t receive the entire $12,000 per month. The IRS Per Diem would limit you to $10,950 per month, which would last for 30 months. And, if you went on claim when the IRS Per Diem was $15,000, American General would limit your monthly benefit to your capped amount of $12,000 per month. Lastly, if you did not choose a 2% or 4% cap, then your maximum monthly benefit is your total benefit divided by 12. In this example, $300,000 ÷ 12 = $25,000 per month. Naturally, if the Per Diem amount is less than $25,000 per month, you’ll receive the Per Diem in effect when you began your claim. *Maximum monthly benefits limited to IRS per diem in effect at time of claim 15

The third and final prong of protection the Asset Protector provides is protection against living too long and potentially running out of money during retirement and not being able to extend ones assets as long as necessary. This is achieved by utilizing the Lifestyle Income Solution rider which provides a type of longevity protection.

What the Statistics Say
Here let’s look at some statistics. If we look at a married couple there is a 50% chance that one of them will live to age 92 and there is a 10% chance that one will live to 104. Chances of survival to age X for one spouse of a couple Prepared by Ernst & Young Insurance and Actuarial Advisory Services practice. The analysis uses the Annuity 2000 mortality table with Scale G2 mortality improvements.

The Case for Lifestyle Income Solution: Longevity Insurance
The positive aspects of living longer come with some financial concerns 48% of Americans age 45–70 have no financial plans in place to protect themselves against outliving their assets and the rising cost of health care should they live longer than expected.1 In fact, retirees in America are so afraid of running out of money that a recent survey said that 61% of them fear running out of money more they fear dying! But, more interestingly, in spite of the intense fear of running out of money, 48% of Americans have done NOTHING to protect themselves against this contingency. Today, you have an opportunity to change that. 1 State of the Insured Retirement Industry: 2012 Recap and a 2013 Outlook, Insured Retirement Institute.

Think about what may contribute to
the possibility of outliving your retirement income. Do any of these issues concern your clients? Debt Social Security Uncertainty Historically Low Interest Rates Health Care Expenses Stock Market Corrections Didn’t Save Enough Rising Income Tax Rates Political Uncertainty As you ponder the financial concerns of retirement with your clients, surface the multitude of issues that can disrupt – or even destroy – their ability to have their assets last as long as they do. Here is just a small sampling of the financial concerns that weigh heavy on the minds of your clients as they approach retirement. Unfortunately, most clients struggle enough just to save adequate money for retirement’s basic needs: “food, shelter and clothing.” Many times they go into retirement attempting to ignore these issues, hoping they don’t actually happen. If any of them do – especially if more than one happen – their retirement resources are suddenly at serious risk.

Lifestyle Income Solution: Longevity Insurance
Accelerate up to 10% of DB per year Primary requirement: Live to age 85 Tax-free up to basis; ordinary income after The Lifestyle Income Solution: provides a type of longevity insurance. With this rider the insured/policyowner has the ability to accelerate up to 10% of their death benefit per year. The primary requirements is that they live to age 85. It is a tax free return of their cost basis “100% ROP” and the rest is taxed as ordinary income. Choosing to exercise rights under the Lifestyle Income Solution can impact cash available under the Accelerated Access Solution. Please speak with your American General Life Insurance Company representative for more information.

Hypothetical information for illustrative purposes only.
100% ROP at Age 85 2.4x more! Premiums Returned! Here an example of the output on the quote for the Lifestyle Income Solution. At the age of 85 this client starts to accelerate their death benefit at a rate of roughly 10% per year. The total premium paid into this policy totals $323,204 which is 2.4x more than the guaranteed cash value at the age of 85. By age 88 the client has received back all of their premium by utilizing the Lifestyle Income Solution. Quote dated 10/13/2016 for the state of Texas. Hypothetical information for illustrative purposes only.

American General Life is…
Revolutionizing the way YOU sell life insurance! “Telling The Story” The more you learn about these riders, and the ability to combine them into a package, the more you’ll see that you can revolutionize the way you sell life insurance. Let’s look at some story-telling ideas you can use to help convey your message – and the importance – of purchasing a complete package rather than an ordinary life insurance policy. 23

Risk Protection Spectrum
Age 65 – 70 Income Replacement Reduced Social Security Income $ $ Mortgage Payoff Health Care Costs Kids to College This graphic depicts some of the risks Americans face before and during retirement. Earlier in life there are 3 major risks that individuals and families face, but each risk tends to get smaller over time. Those 3 major risks are: Paying off the mortgage, Income replacement due to the death of a primary breadwinner and The cost of college savings for children. As we get older and these risks decline, a few other risks emerge, and they tend to become more daunting over time: The multitude of financial risks….the possibility of living too long, interest rates, stock market, political instability, rising tax rates, house repairs, etc., The rising cost of health care, and The potential reduction of social security income due to the death of a spouse Let’s talk about these in a little more detail and provide an all-encompassing solution. Financial Risks 20-40 Years Prior to Retirement Retirement Years 3 big risks get smaller over time. 3 other big risks get larger over time. 24

The Big 3 Life Insurance provides protection for:
Income Replacement Mortgage Payoff College Funding Reduced Social Security Income when one spouse dies Asset Protector’s Lifestyle Income Solution provides protection for: The multitude of financial risks: Market corrections and poor investment performance Living longer than expected / didn’t save enough Health care costs (other than Chronic Illness) Unexpected expenses (roof, furnace, A/C, auto repairs, etc.) Financial help for children and grandchildren And so much more! Asset Protector’s Accelerated Access Solution provides protection for: Health Care Costs from Chronic Illness First of all, at the core of your asset protection, you have life insurance. The life insurance policy provides protection for: Income replacement if you die prior to retirement Paying off any outstanding mortgage balance Providing college funding for your children And, during retirement, the death benefit can provide funding to replace reduced Social Security income due to the death of one spouse. Next, the Lifestyle Income Solution provides protection against a multitude of financial risks including: Market corrections and poor investment performance Living longer than expected Didn’t save enough Tax rate increases Low interest rates Reduced Social Security income if one spouse dies (the death benefit protects one spouse, the Lifestyle Income Solution protects the other spouse) Health care costs (unrelated to Chronic Illnesses) Unexpected house repairs Financial help for children and grandchildren, And so much more! ! ! And, lastly, the Accelerated Access Solution provides protection against the high costs of chronic illness care, especially if it results in a nursing home confinement or other expensive treatments. Together these three coverages provide an unparalleled package of protection against a broad array of financial risks that are so prevalent during retirement. And AIG is the only company that provides protection from all of these risks in one financial product. . . Life insurance. 25

Change the way you sell life insurance: Term Life Insurance Sales
Turn your Term Life Insurance Sales Into Permanent UL Sales! Now you can see that American General Life’s Secure Lifetime GUL 3, combined with Accelerated Access Solution and Lifestyle Income Solution can change the way you sell life insurance by turning your Term life insurance sales into Permanent UL sales. How? You can’t purchase this package of benefits on a Term life insurance policy. If your client wants their assets to be protected from the diverse risks they face – both before and after retirement – they need to step-up to Universal Life. 26

Clients are Protected Whether They:
Sell The Value: Clients are Protected Whether They: Remember to sell the value. As it’s often said: price only matters in the absence of value. Demonstrate to your clients the impact of this value – how they can protect their assets, and their loved ones – by spending a little more to get such high-quality financial security. Remember, money is the source of some of retirees greatest fears. Surveys indicate that they are more afraid of running out of money than they are of dying. You are now equipped and empowered to provide asset protection. If financial security is the key to sleeping restfully, then your clients will sleep better because of the package of financial security you have provided. 27

Summary: The level of liquidity created by the additional Asset Protector premium can’t be created any other way. If you’ve made the decision to buy permanent UL, about the only reason you wouldn’t buy Asset Protector is because you simply can’t afford it. If you can afford it, what else can you do with the money to generate this kind of liquidity and value? Read Slide 28

They’ll never want to own life insurance any other way!
Summary: When clients – especially premium payers – realize that they can spend their entire Death Benefit while they’re still alive. . . They’ll never want to own life insurance any other way! Asset Protector provides an unmatched level of financial security, especially during retirement, whether you: Read Slide 29

Asset Protector: It Really IS Worth It!
Read Slide

Become a part of the next generation of life insurance!
American General Life is revolutionizing why people buy life insurance, and how it’s sold. Become a part of the next generation of life insurance! Read Slide

Bring On Tomorrow! Read Slide

Important Information
For this brochure to be complete for California residents, they must be provided the “California Resident Supplemental Information” flyer on the Accelerated Access Solution (AGLC108547) Policies issued by: American General Life Insurance Company (AGL), Policy Form Number 13460, ICC , 15442, ICC Rider Form Number 13972, 13600, ICC , , 15900, ICC , Issuing company AGL is responsible for financial obligations of insurance products and is a member of American International Group, Inc. (AIG). AGL does not solicit business in the state of New York. Policies and riders not available in all states. These product specifications are not intended to be all-inclusive of product information. State variations may apply. Please refer to the policy for complete details. There may be a charge for each rider selected. See the rider for details regarding the benefit descriptions, limitations and exclusions. Guarantees are backed by the claims-paying ability of the issuing insurance company. AGLC107915REV0616 ©2016. All rights reserved. Here are some important notes about products and riders we’ve discussed, as well as information about AIG. At AIG we hope to continue to provide you with the products, the people and the services that have become the hallmark of AIG. Bring on tomorrow!

Secure Lifetime GUL 3 with Asset Protector

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