1. Asset-Based Long-Term Care
Producers Choice offers 3 life insurance based long term care products: Lincoln Financial Group – MoneyGuard II, Genworth – Total Living Coverage (TLC), and OneAmerica – Asset Care.

2. The Big Question
If over 70% of people age 65* and older will require LTC, why do less than 10% of consumers own LTC insurance?**
70%
The first thing that we want to take into consideration is the need for solutions. Most consumers are not protecting themselves from the costs of LTC expenses for a number of reasons. They may believe that they are healthy and will not incur LTC costs, they are going to self-insure, or they know they may need coverage but are not willing to commit to paying more insurance premiums. Many clients feel that they are already over insured and that they do not get benefits from their current insurance policies.
*Source: U.S. General Accounting Office, Long Term Care: Aging Baby Boomer Generation will increase financial burden on state and federal budgets,” March 21, 2002.
**Source: U.S. Department of Health and Human Services, National Clearinghouse for Long-Term Care Information, September 2008.

3. Objections to Traditional LTC Insurance
Traditional LTC Insurance is often considered very expensive.
Traditional LTC Insurance does not have guaranteed premiums.
Client may never us the LTC Insurance.

4. Carriers and Products
Producers Choice offers 3 life insurance based long term care products: Lincoln Financial Group – MoneyGuard II, Genworth – Total Living Coverage (TLC), and OneAmerica – Asset Care.

5. LFG-MoneyGuard II “Live, Quit or Die”
65 year old male - $100,000 deposit – Couples Discount
ROP Benefit
$80,000
Initial Specified Amount $143,699
Total Long-Term Care Benefit Limit $431,097 Or Or
Quit
Die
Live
Someone will always benefit from a MoneyGuard policy, hence the “Live, Quit, or Die” slogan.
If the client would like to “quit,” an 80% return of premium is available. Or, if they die, a death benefit will pay out to the client’s beneficiaries. Finally, if they live, the client can usually spend between 4 and 5 times their single premium on long term care.

6. Lincoln MoneyGuard® II provides expense reimbursement for Long-Term Care expenses including:
-Adult day care Home healthcare Hospice services
-Nursing home care services Assisted living Alternative care services
Single Premium
$100,000
This projection of values assumes premiums are paid as shown. The premium amount is received on the policy effective date.
Long-Term Care Benefit Limits:
Initial Monthly
Initial Annual
Initial Total
$5,987
$71,850
$431,097
These are the initial amounts available for expense reimbursement for Qualified Long-Term Care Services, subject to rider terms and conditions.
Inflation Option
N/A
Minimum Long-Term Care
Benefit Duration
6 Years
Reimbursements for Qualified Long-Term Care Services, are available, based on the selected rider(s):
Long-Term Care Acceleration of Benefits Rider (LABR): 2 years
Long-Term Extension of Benefits Rider (LEBR): 4 years
Deductible Period
None
There is no deductible period. Benefits are payable on the first day of care for eligible claims.
Initial Specified Amount
$143,699
The Specified Amount is set at issue. Long-Term Care reimbursements reduce the Specified Amount on a dollar-for-dollar basis.
Initial Residual Death Benefit
$7,184
The minimum death benefit if Long-Term Care reimbursements have reduced the Specified Amount.
Return of Premium
$80,000
Amount available upon surrender after all planned premiums are paid.
LTC Acceleration of Benefits Rider Charge
$43.83/mth
LABR Base charge is $43.83 per month for 10 years.
LTC Extension of Benefits Rider Charge
$79.47/mth
LEBR Base charge is $79.47 per month for 10 years.
This is the summary of benefits that will most likely be used in a client presentation (explain line-by-line).

7. Long-Term Care Reimbursement Benefit Limits (2)
All Values and Benefits shown are Guaranteed (1)
Year
Age
Planned Premium
Surrender Value(5)
Death Benefit Amount
IRR(3)
Total
Annual
Monthly
IRR(4) 1 66
100,000
80,000
148,000
48.0%
431,097
71,850
5,987
68.7% 2 67
144,000
20.0%
44.3% 3 68
143,699
12.9%
33.2% 4 69
9.5%
26.8% 5 70
7.5%
22.5% 6 71
6.2%
19.4% 7 72
5.3%
17.1% 8 73
4.6%
15.3% 9 74
4.1%
13.8% 10 75
3.7%
12.6% 11 76
3.4%
11.6% 12 77
3.1%
10.7% 13 78
2.8%
10.0% 14 79
2.6%
9.3% 15 80
2.5%
8.8% 16 81
2.3%
8.3% 17 82
2.2%
7.8% 18 83
2.0%
7.4% 19 84
1.9%
7.1% 20 85
1.8%
6.7% 21 86
1.7%
6.4% 22 87 23 88
1.6%
5.9% 24 89
1.5%
5.7% 25 90
5.5% 26 91
1.4% 27 92
5.1% 28 93
1.3%
4.9% 29 94
4.8% 30 95
1.2% 35
100
1.0%
4.0% 40
105
0.9%
3.5% 45
110
0.8% 50
115 55
120
All of the benefits with MoneyGuard II are fully guaranteed. Even though MoneyGuard II is primarily a long term care product, the IRR on death benefit is also respectable at life expectancy (1.8% tax free).

8. A Smarter Alternative to Self Insuring
Additional Long-Term Care (LTC) Benefit
$287,398
Freed-up Funds for Your Use
$300,000
Readily Available Assets $400,000
Death or LTC Benefit
$143,699
Premium
$100,000
Moved
$400,000
Sales idea: use one quarter of the money you have set aside to self-insure against long term care as a deposit for MoneyGuard, and you will immediately free up the remaining assets to use as you please.

9. Underwriting Simplified Issue 45 minute Personal History Interview
Only 2 classes: male and female
Incorporates smoker and non-smoker
Incorporates preferred best through table 4
Compensation
6% or $6,000 in example
Policy issue is more transactional than most life insurance products because the simplified underwriting requires only a 45 minute personal history interview. Additionally, there are only 2 risk classes, male and female, which incorporate both smokers and non-smokers, and all risk classes from preferred best through table 4 non-tobacco. Smokers and clients in the table 2-4 range can benefit from this.

10. Nationwide - CareMatters
65 year old male - $100,000 deposit – Couples Discount
Total
Long-Term Care Benefit Limit
$389,159 or
Initial Specified Amount
$129,720 or
ROP Benefit
$100,000 year 6
“Live, quit or die” also holds true with Genworth – TLC. The predominant difference between TLC and MoneyGuard II is that TLC is fully underwritten, and clients in great health can benefit from a 15% preferred discount.
Quit
Die
Live

11. Nationwide – CareMatters:
Single Premium - $100,000
Long-Term Care Benefits
Initial Monthly: $5,405
Initial Annual: $64,860
Initial Total: $389,159
Inflation Option - N/A
Minimum Long-Term Care Benefit Duration - 6 years
Deductible Period - 90 days
Specified Amount - $129,720
Guaranteed Minimum Death Benefit - $25,944
Return of Premium: $100,000 beginning year 6

12. Key Differences
Benefits are indemnity-based - no submission of receipts
90 day elimination period
Return of premium follows vesting schedule:
85% year 1, 88% year 2, 91% year 3, 94% year 4, 97% year 5, 100% year 6
20% guaranteed minimum death benefit if Initial Specified Amount is exhausted
1, 5 and 10-pay options only
3% simple and 5% compound inflation options

13. Underwriting Simplified Issue 45 minute Tele – Interview Compensation
5.5% or $5,500 in example
As previously mentioned, Genworth – TLC is fully underwritten, but the silver lining in the clouds is that healthy clients can qualify for a preferred underwriting class and a 15% preferred discount.

14. One America – Asset Care
Survivorship with Lifetime Continuation of Benefits
For a husband and wife who both desire protection from long term care expenditures, OneAmerica – Asset Care typically offers greater benefits than purchasing 2 separate MoneyGuard II or TLC policies. Another proprietary feature of Asset Care is that the Continuation of Benefits Rider can provide coverage for life, whereas MoneyGuard II and TLC only offer finite benefit periods.
*Includes $21,696 for optional Continuation of Benefits
Rider single premium. This rider is non-cancelable, meaning your premium cannot
Be increased and we can make no changes to the rider without your consent.

15. Initial Specified Amount: $259,016 Contract Premium: $128,303.58
End of Policy Year
Insureds’ Joint Equal Age
Contract Premium
Cash Value
Accumulation Fund
Cash Surrender
Value*
Death Benefit/LTC
Benefit Balance** 1 65
$128,303.58
$106,725
$128,304
$259,016 2 66
$0.00
$110,916 3 67
$115,208 4 68
$119,601 5 69
$124,084 6 70
$128,651 7 71
$133,292 8 72
$137,996
$132,476 9 73
$142,741
$138,459 10 74
$147,517
$145,305 11 75
$152,309 12 76
$157,104 13 77
$161,882 14 78
$166,622 15 79
$171,305 16 80
$175,911 17 81
$180,402 18 82
$184,746 19 83
$188,931 20 84
$192,951 25 89
$210,005 30 94
$222,681 35 99
$230,822 40
104
$237,813 45
109
$242,905 50
114
$246,319 55
119
$250,039 57
121
Prepared for:
State: MI
Class: Class 1
Mr. Valued Client
Sex: M P
Age: 65
Mrs. Valued Client
Sex: F P
Age: 63
Joint Equal Age: 64
Initial Specified Amount: $259,016
Contract Premium: $128,303.58
It is assumed the premium will be paid no later than when the policy is issued.
Presented by: Valued Agent
Asset Care I features a Return of Premium benefit, however money used to pay for the Continuation of Benefits rider is not available for a return of premium. Even so, the product features cash accumulation that rivals other fixed savings vehicles (4% guaranteed interest rate).

16. Underwriting Simplified Issue
45 minute personal history interview (similar to MoneyGuard II)
May require full underwriting if:
Client has not seen a doctor within past 12 months
There is a history of major medical concerns
The net amount at risk is greater than $250,000
Compensation
Asset Care I: 8% or $12,000 in example
Underwriting is generally simplified and simply requires a 30 minute Personal History Interview. In certain situations, Asset Care can move to full underwriting (see above for criteria).

17. Lincoln Financial Group
Summary
Funding
Underwriting
Compensation
When to Use
Lincoln Financial Group
MoneyGuard II
Non-Qualified
1-10 pay
Simplified 6%
Individual Life
Couples Discount,
Average or below average health, Smokers
Nationwide
CareMatters
Non-Qualified
1, 5 and 10-pay
Simplified
5.5%
Individual Life
Couples Discount,
Indemnity
Style Benefits
OneAmerica
Asset Care
AC I-NQ 1-pay
AC II-Annuity 1035
AC III-IRA Transfer
AC IV pay,
Life-pay
Depends
AC I-8%
Joint policy/Survivorship
Variety of funding options
Lifetime COB