THE COMBO APPROACH A Simple Way to Insure the Whole Family.

THE COMBO APPROACHA Simple Way to Insure the Whole Family

Do you have clients who’s untimely death would result in:• final expenses to their estate – funeral, estate administration,

taxes, inheritance, etc.?• leaving debts behind?• diminished lifestyle for their immediate family?• jeopardizing goals such as kids’ education, retirement for

surviving spouse, etc.?

A majority of people will answer “yes” to one or more of the questions above.

But covering financial needs with life insurance is not the only thing consumers are looking for…

Guarantees Flexibility

AdditionalOptions

Simplicity

• Guarantees, flexibility and additional options are mostly product-related. Participating whole life encompasses these features.

• Simplicity is as much about the process than it is the product.• The easier it is for clients to understand why they have the

insurance plan that was recommended to them, the better the chance they’ll stick with it.

Simplicity1. Identify insurance needs.2. Categorize each need as permanent or temporary.3. Use a corresponding insurance coverage (permanent or term)

for each need or group of needs.4. If possible, group the various coverages in one policy.

Participating Whole LifeFinal expenses, donation, inheritance

Protecting family lifestyle until retirement of surviving spouse

Debts (match insurance term with debt amortization)

Insuring kids for their future financial security.

Term Life Rider with

matching term

Term Life Rider with

matching term

Term Life for kids(with guaranteed insurability option)

Guarantees Guaranteed premiums – No surprises!

Guaranteed insurance amount – Just pay the premiums.

Cash surrender value, which can be used for:• Reduced paid-up option• Guarantee for a policy loan or collateral loan• Withdrawals upon surrender of part or all of the whole life

insurance. Guaranteed insurability for the kids (term life rider)

Flexibility Dividends

• Increase the insurance amount – PUA; this helps reduce risk of inflation on final expenses or increase the value of inheritance.

• More insurance for a lower premium with the Enhanced dividend option.

• Use them for liquid savings or to reduce your premiums, or cash them.

• Possibility to change dividend options as financial needs change.

Term life is renewable and convertible• If temporary insurance need lasts longer than expected (i.e. it takes

longer to repay debts) or a new permanent insurance need arises, renewal and conversion options can help to address the issue.

Additional Options DI on participating or term life insurance to help

cover loan payments or replace part of income in case of disability.

Term life insurance for the kids – guarantees their future insurability.

Waiver of premiums in case of disability or death.

Simplicity Simplified issue process for total insurance amount of

$250k or less.

Same questions for whole life and term insurance (adults)

No investment decision required from the client.

Easy step-by-step electronic application.

Matching insurance type with needs helps clients better understand why they’re buying the insurance.

ProfitsProfits

Par FundPar Fund

Projected returnsProjected returns

UnderperformsUnderperforms

Greater performance!Greater performance!

Mutual Company

100% of the Par Fund profits go to the

participating policy holders. They have

ownership interest in the insurance company.

Public Company

A portion of the Par Fund profits goes to the

shareholders instead of the policy holders. The shareholders are the

owners of the company.

• During 1999-2000, when many insurance companies demutualized: It is estimated that over $10 billion $10 billion was handed out to 3 million 3 million participating life insurance policyholderspolicyholders, , that is in addition to retaining their continuing life insurance coverage and policy cash values.

• As a participating policyholder, you have an ownership interest in the mutual insurance company.

•Reduced Premium OptionReduced Premium Option•Used to reduce the annual premium otherwise payable.

•Paid in Cash OptionPaid in Cash Option•Paid to the policyholder annually in cash / cheque 1

2

Whole Life Basic Insurance

Time

Dea

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enefi

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Tota

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tial

Amou

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Reduce Your Annual Reduce Your Annual Premiums Premiums (Tax-free)Reduce Your Annual Reduce Your Annual Premiums Premiums (Tax-free)

Cash back! Get your Cash back! Get your dividends paid-out.dividends paid-out.Cash back! Get your Cash back! Get your dividends paid-out.dividends paid-out.

-$1,000-$800-$600-$400-$200

$$200$400$600

36 41 46 51 56 61 66 71 76 81 86

Prem

ium

Age

Payable Premium

Total Premium

The projected dividends will coincide with the premium

amount roughly after 30 years*

The projected dividends will coincide with the premium

amount roughly after 30 years*

Illustration based on Male, 35, NS, for $50,000

* Dividend amounts are not guaranteed. The actual period at which premiums and dividends coincide may be more or less than 30 years.

• Reduced Premium OptionReduced Premium Option• Used to reduce the annual premium otherwise payable.

•Accumulation OptionAccumulation Option•Accumulate with interest as part of the policy (interest is taxable).

• Paid in Cash OptionPaid in Cash Option• Paid to the policyholder annually in cash / cheque 1

2

3

Whole Life Basic Insurance

TimeD

eath

Ben

efit

Tota

l Ini

tial

Amou

ntDividends

accumulate and gain interest!

Dividends accumulate and

gain interest!Interest on dividends is taxable.Interest on dividends is taxable.

• Reduced Premium OptionReduced Premium Option• Used to reduce the annual premium otherwise payable.

• Accumulated OptionAccumulated Option• Accumulate with interest as part of the policy.

• Paid in Cash OptionPaid in Cash Option• Paid to the policyholder annually in cash / cheque

•Paid-Up Additions OptionPaid-Up Additions Option•Used to purchase paid-up additions, which will exponentially increase the death benefit.

1

2

3

4

Whole Life Basic Insurance

Paid-Up additions

Time

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Dividends buy more permanent life

insurance every year!

Dividends buy more permanent life

insurance every year!

NO ADD’L NO ADD’L UNDERWRITING UNDERWRITING

IF CHOSEN AT IF CHOSEN AT PURCHASEPURCHASE

$

$50,000

$100,000

$150,000

$200,000

$250,000

36 41 46 51 56 61 66 71 76 81 86 91 96

Cove

rage

Age

Death Benefit

Death Benefit

Illustration based on Male, 35, NS, for $50,000

At age 86, death benefit is

triple the original amount.

At age 86, death benefit is

triple the original amount.

At age 71, death benefit is

double the original amount

At age 71, death benefit is

double the original amount

* Dividend amounts are not guaranteed. The actual age at which the death benefit will be double and triple the initial insurance amount may be different.

• Reduced Premium OptionReduced Premium Option• Used to reduce the annual premium otherwise payable.

• Accumulated OptionAccumulated Option• Accumulate with interest as part of the policy.

• Paid in Cash OptionPaid in Cash Option• Paid to the policyholder annually in cash / cheque

• Paid-Up additions OptionPaid-Up additions Option• Used to purchase paid-up additions, which will exponentially increase the death benefit.

•Enhanced Option Enhanced Option •Used to purchase a combination of one-year term insurance and paid-up additions. •Under this option, the death benefit is equal to the sum of the basic insurance amount, the paid-up additions and the one-year term insurance amount.

1

2

3

4

5

Term Insurance (T1)

Paid-up Additions

One-year term

Paid-up Additions

Tota

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on-g

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d

Time

Dea

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enefi

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MUST BE MUST BE

SELECTED SELECTED

AT AT

PURCHASEPURCHASE

Whole Life Basic Insurance

15-yearGuarantee

Term Insurance (T1)

Paid-up Additions

One-year term

Paid-up Additions

Tota

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Time

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MUST BE MUST BE

SELECTED SELECTED

AT AT

PURCHASEPURCHASE

Whole Life Basic Insurance

Guarantee to age 100

$

$500

$1,000

$1,500

$2,000

36 46 56 66 76 86

Prem

ium

Age

Paid-up Additions

Enhanced

Notice the premiums for the enhanced option are much

lower

Notice the premiums for the enhanced option are much

lower

Illustration based on Male, 35, NS, for $50,000

Paid-Up Additions and Enhanced Options• Policy dividends under these two options are not taxable.

Cash or Accumulation Options• If the dividend paid exceeds the policy’s adjusted cost basis (ACB),

the excess amount will be fully taxable in the year it is paid.• For the Accumulation option, interest paid on the accumulated

dividends is fully taxable. However, withdrawals made from the dividend account are not taxable.

Premium Reduction Option• The portion of the dividend used to reduce the premium is not

taxable. • Any excess dividend paid to the policyholder will be taxable if it

exceeds the policy’s ACB in the year it is paid.

• Under the enhanced option, combination of– Basic whole life insurance– Paid-up addition and one-year term bought with dividends

• When changing from the enhanced option to another dividend option, the total insurance amount at the time of the change will be equal to the basic whole life + the paid-up insurance.

Example• 35-year-old MNS takes a $100,000 policy with the enhanced option.

Year Basic Whole Life Insurance Amount

Paid-Up Insurance Amount

One-Year Term Insurance Amount

1 $40,519 $280 $59,201

5 $40,519 $1,312 $58,169

10 $40,519 $3,200 $56,281

15 $40,519 $6,589 $52,892

Permanent, whole life participating insurance

• T-15, T-20 or T-25 Life Insurance• DI Rider available

• Based on loan payment• Based on earned income

• Renewable to age 80• Convertible to ParPlus before age 65

• Term to age 25 for children• Guaranteed insurability option at age 25• Living benefit in case of covered illness

• Issue age: 18-75• Online ProductOnline Product -no paper apps.• GuaranteedGuaranteed level premiums• Permanent, Permanent, life-pay or 20-pay whole life insurance• Coverage type: SingleSingle or Joint-first-to-dieJoint-first-to-die• Simplified issueSimplified issue available on ages 18-65 and amounts of $250,000 or

less. (if all questions answered no and subject to MIB) • Basic insurance amounts: Basic insurance amounts: Min. $5,000 / Max: $4,000,000• Policy fee: $80 (flat fee)• Riders:Riders:

– FlexTerm (Term 15, 20 or 25 life insurance with DI rider)– Youth Plus (Term-to-age-25 life insurance for kids, with guaranteed insurability

option)– Child Insurance Benefit –rider (CIB)– Accidental Death and Dismemberment (AD&D)– Waiver of Premiums upon Disability (WPI)– Waiver of Premiums upon Death (WPD)– Disability Income available (loan payment or earned

income)

Dividend options:Dividend options:• Enhanced Enhanced (15 year guarantee or guarantee (15 year guarantee or guarantee

to age 100)to age 100)• Paid-Up AdditionPaid-Up Addition• AccumulationAccumulation• Cash / Reduced premiumCash / Reduced premium

Premium band:Premium band:• 5-24K5-24K• 25-99K25-99K• 100-250K100-250K• More than 250KMore than 250K

Permanent, whole life participating insurance

• Issue age: 0-17• Online ProductOnline Product (no paper app.)• GuaranteedGuaranteed level premiums• Permanent , 20-pay20-pay life insurance• Simplified issueSimplified issue available on amounts $250,000 or less.

(If all questions answered no, subject to MIB) • Coverage type: SingleSingle• Coverage amounts: Coverage amounts: Min. $5,000 / Max: $4,000,000• Policy fee: $80• Riders:Riders:

– FlexTerm (Term 15, 20 or 25 life insurance with DI rider)– Youth Plus (Term-to-age-25 life insurance for kids, with guaranteed insurability

option)– Accidental Death and Dismemberment (AD&D)– Waiver of Premiums upon Disability (WPI)– Waiver of Premiums upon Death (WPD)

Dividend options:Dividend options:• Enhanced Enhanced (15 year guarantee or (15 year guarantee or

guarantee to age 100)guarantee to age 100)• Paid-Up AdditionsPaid-Up Additions• AccumulationAccumulation• Cash / Reduced premiumCash / Reduced premium

Premium band:Premium band:• 5-99K5-99K• 100-and up100-and up• Full selection for 250K +Full selection for 250K +

From our web site, click on Producer’s Corner

Go in the Individual Insurance Section

Click on the product for which you want information or click on “Product Guides” in the Helpful Links.

Guarantees Flexibility

AdditionalOptions

Simplicity

• Flexible dividend options: helps you get customized insurance • Become a part-owner!!!• Permanent coverage! Insurance for life• Term riders for a more complete coverage• Guaranteed level premiums! Premiums will never go up, guaranteed!• Easy application process –simplified issue for ages 18-65 and for amounts

$250,000 or less! Means, no needles- no blood test- no doctors…• No-hassle insurance! No need to track your portfolio or worry about when

your insurance will end. Stability you can depend on!• Bank-friendly! Some financial institutions will loan up to 85% of the

accumulated cash value• Online product – quicker process

More than just coverage, it’s insurance that pays you back!

• Excellent FYC commissions (get paid twice a week)• Online product – no paper - Faster commissions!• Simplified issue–for ages 18-65 and for amounts $250,000 or less!

(if all questions answered no, subject to MIB) • Great dividend options: 5 options to choose!• Flexible! Something for the whole family. (ParPlus, ParPlus Junior,

FlexTerm rider and Youth Plus rider)

Assumption Life Assumption Life is a thriving Canadian Mutual Insurance Company with over a century of experience! century of experience! (since 1903)

We pride ourselves on our innovative, solution-basedsolution-based, approach in making every step easier for our clients! easier for our clients!