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Insurance made Simple, Fast Easy
Sept 2016 Advisor Use Only
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Agenda

• Policy Holder Taxation Update
• Introducing Empire Life CI Protect
• Case Study

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Policy Holder TaxationCommunication Plan
Announce to top producers the cessation of
Trilogy, Optimax Vital Link sales October 14,
2016.
July
Announce to all advisors/public the cessation of
Trilogy, Optimax Vital Link sales October 14,
2016.
August
Announce NEW Term, PAR CI plans coming October.
Announcement of transition rules for Oct 14,
2016.
August
Oct 14, 2016 deadline for old product
applications. Launch of NEW Term, PAR CI plans
using G2(current) tax rules.
October
Reminder of deadline for in-the-mill business to
qualify for G2 (current) tax rules on November
30, 2016.
November
Transition to G3 illustrations for all products
December
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2016 Product Line-Up Changes
July 2016
October 15, 2016
Solution 10 Solution 20 Solution 100 Trilogy
EstateMax (20 Life Pay) Optimax (20 Life
Pay) CI Protect Vital Link Simplified
10 Simplified 20
Solution 10 Solution 20 Solution 100 Solution
ART EstateMax (20 Life Pay) Optimax Wealth (20
Life Pay) CI Protect CI Protect Plus
(November) Simplified 10 Simplified 20
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Trilogy
Why Sell before October 14, 2016?

• Only Universal Life product on the market with
  T10 and T20 COI options
• No surrender fees, guaranteed 1.75 account
• Guaranteed option to switch between all 5 COI
  options, no change to tax status when cost change
  made
• Full commission paid on switch between COI
  option

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Sales Illustration Software Releases
Novinsoft Release with New Products
(G2) Illustrate Inc. discontinued
October
November 30, 2016 Novinsoft G3 Release
November
New Sales Concept Tool added to Novinsoft
release
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New Sales Concepts added to Illustration
Software
Sales Concepts For PAR
1) Annuity Estate Maximizer 2) Asset Value
Preserver 3) Capital Dividend Account 4) Capital
Gains Protector 5) Charitable Insurance 6)
Corporate Insured Retirement 7) Corporate
Redemption Of Shares 8) Corporate Split Dollar
9) Employee Shareholder 10) Family Split
Dollar
11) Guaranteed Insured Inheritance 12) Income
Shelter 13) Insured Annuity Ledger 14) Insured
Retirement 15) Internal Rate of Return 16) Key
Person 17) RRIF Estate Maximizer 18) Education
funding with Par Ins 19) Pension Maximization
20) Annuity Funded Life Insurance
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• QUESTIONS?

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Empire Life CI Protect Critical Illness
made Simple, Fast Easy
Sept 2016 Advisor Use Only
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Critical Illness Insurance Sales
LIMRA Canadian Individual CI Sales Q1 2015 Q1 2016 Change
Premium 25 million 28 million ? 13
Policy Count 24,324 28,557 ? 17
Average Premium 1,045 1,010 ? 3
Average Coverage 71,954 70,751 ? 2
Source Canadian Individual Critical Illness
Sales Report Q1 2016, LIMRA
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Critical Illness Insurance Sales

• Q1 2016 Sales by Product Type

Most popular
Source Canadian Individual Critical Illness
Sales Report Q1 2016, LIMRA
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Critical Illness Insurance Sales

• Q1 2016 Sales by Product Type

Most popular
Source Canadian Individual Critical Illness
Sales Report Q1 2016, LIMRA
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Critical Illness VS Life Insurance

• Despite the faster growth rate in policy count,
  individual CI sales are still relatively small in
  comparison to individual life sales

Canadian Individual Insurance sales 2015  Industry Industry
Canadian Individual Insurance sales 2015  Annualized Premium of Policies
Life Sales 1,365,056,000 719,832
CI Sales 121,034,795 117,198
CI Sales (vs. Life) 8.9 16.3
Source Canadian Individual Critical Illness
Sales Report 2015, LIMRA
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Critical Illness Insurance Needs

• Considering

9 in 10 Canadians have at least one risk factor
for heart disease or stroke2
About 2 in 5 Canadians will develop cancer in
their lifetime1
Over 19,000 Canadians ages 18 or older had
coronary bypass surgeries performed.4
62,000 strokes occur in Canada each year that
is one stroke every nine minutes.3
1 Canadian Cancer Statistics 2015, Canadian
Cancer Society. 2 2015 report on the health of
Canadians, Canadian Heart and Stroke
Foundation. 3 Stroke Report 2015, Canadian Heart
and Stroke Foundation. 4 Based on 2013 Coronary
Artery Bypass Graft (CABG) rate for both sexes,
age-standardized rate per 1,000 of population,
Canadian Institute for Health.
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Why Critical Illness Insurance Sales Still Low?

• Factors that contribute to lower CI sales

Placing critical illness insurance is harder and
takes longer than life insurance
Critical illness insurance is too expensive
Couldnt find the right opportunity to start the
conversation
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Introducing Empire Life CI Protect

• Critical illness insurance made
• Simple
• Fast and
• Easy

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Critical Illness Insurance Made Simple, Fast
Easy

• Simple product features
• Covers 4 major illnesses no bells and whistles
  to keep cost low

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Critical Illness Insurance Made Simple, Fast
Easy

• FAST application process
• Available
• Fast Full life application or
• Paper (complete D-0082 D-0082C)

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Critical Illness Insurance Made Simple, Fast
Easy

• Easy to apply
• Use Life insurance questions
• One knock-out health question
• No additional CI requirements

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CI Protect Product Details

• Covers 4 major critical illnesses cancer, heart
  attack, stroke and coronary bypass surgery
• Account for 88 of paid CI claims

Source Munich Re 2014 Individual Insurance Survey
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CI Protect Product Details

• 10-year renewable term with guaranteed initial
  and renewal premiums

• 18 65 (age nearest)
• 25,000 to 75,000
• Coverage expires at age 75
• Single life coverage
• As base coverage or
• As rider to Solution Series and EstateMax

Target middle income families - Canadians who are
ages 25 to 50
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CI Protect Product Details

• Standard risk classes non-smoker or smoker
• Non-convertible
• Annual policy fee 50 (0 as a rider)
• No optional riders/benefits
• Built-in lump sum death benefit of 1,000 payable
  if life insured dies from any cause before
  becoming eligible for the critical illness
  benefit

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CI Protect Product Details

• Use Life underwriting
• Uses Life insurance underwriting questions
• One knock-out question
• Life insured is considered as a standard risk for
  life insurance and has not been previously
  declined or rated for our Vital Link

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CI Protect Product Details

• Knock-out question
• Have any of your biological mother, father,
  sister(s), or brother(s) been diagnosed before
  their 60th birthday with cancer, heart attack,
  coronary artery disease, stroke, diabetes, kidney
  disease, Huntington's disease or Parkinson's
  disease?

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Competitive Products

• Looked at 13 competitive products
• 5 SI or Non-med CI T10 covering 3 to 6 critical
  illnesses
• 8 Fully underwritten CI T10 covering 3 to 25
  critical illnesses
• Not 100 apple-to-apple comparisons
• Foresters Health Security Plus Adjustable
  premiums with 6 CIs plus ROPD
• SSQ Assurance CI T10 Basic Fully Underwritten
  with 3 CIs
• RBC Simplified Issue CI T10 to age 65 with 3
  CIs
• Manulife Lifecheque Basic T5 with 5 CIs
• Etc

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CI Protect Initial Monthly Premium Comparisons
Male Non-smokers (50K) CI Protect Base CI Protect Rider Vital Link Base Market Leading CI Product 1
25 12.87 8.37 16.47 18.00
30 14.22 9.72 18.14 20.79
35 16.38 11.88 22.73 23.85
40 23.09 18.59 30.42 31.05
45 31.91 27.41 40.77 42.30
Female Non-smokers (50K) CI Protect Base CI Protect Rider Vital Link Base Market Leading CI Product 1
25 12.78 8.28 16.52 17.73
30 14.18 9.68 19.22 20.07
35 18.90 14.40 23.94 23.40
40 23.90 19.40 31.68 30.60
45 30.78 26.28 43.34 43.38
1 Based on LIMRA Q1 2016 Individual Critical
Illness Sales report, Industrial-Alliance is the
market leader in sales of CI insurance products
through the MGA channel. The initial premiums
shown above are based on its Transition
Simplified Issue 10 standalone product as quoted
in LifeGuide on June 15, 2016.
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CI Protect Expected Competitive Rankings
Note Rankings are based on comparings between
LifeGuide quotes on June 15, 2016 for initial
monthly premiums of 13 CI products for the
coverage amounts and life insureds indicated and
the initial monthly premiums for Empire Life CI
Protect for the same coverage amounts and life
insureds. Comparison products are BMO Insurance
Living Benefit 10, Desjardins Harmony T10,
Equitable Living Protection, Humania CI T10,
Industrial-Alliance Transition Simplified Issue
CI, ivari CI Protection T10, La Capitale
Simplified Second Chance T10, Manulife Lifecheque
T10, RBC Simplified Issue CI, RBC CI T10 NC, SSQ
CI T10, Canada Life LifeAdvance T10 and Sun Life
Sun CII T10, which may not have the same features
as Empire Life CI Protect.
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Fast Full Life Application Process

• Can apply for CI Protect through Fast Full
  one of most frequently requested enhancements

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Fast Full Life Application Process

• CI Protect has been added to the Illustration
  Page in Fast Full

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Fast Full Life Application Process

• Family history knock-out question will appear on
  Quote Summary page if applying for CI Protect as
  a base plan

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Fast Full Life Application Process

• If answers yes to knock-out question, a message
  will appear to indicate that client is not
  eligible

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Fast Full Life Application Process

• If answers no to knock-out question,
  advisor/client can follow the application process
  to Beneficiary page

Client can designate beneficiary(ies) for the
critical illness benefit
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CI Protect Family Protection Case Study

• John (age 35) is a healthy, non-smoker, married
  to Mary with two kids
• John is the sole income provider. The family
  household income is 90,000
• Hed like to protect Mary and his children
  financially from any unexpected events

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CI Protect Family Protection Case Study

• John worked with his advisor to create an
  insurance package to help protect his family

Final Expense
Income Protection
Mortgage Protection
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CI Protect Family Protection Case Study

• An affordable insurance solution package for
  John, age 35, standard non-smoker rate class

• EstateMax 100 - 50,000 with Enhanced option
• Base coverage of 27,724
• Enhanced coverage of 23,276
• Monthly premium 33.96

Solution 10 rider of 350,000 Initial monthly
premium 15.44
CI Protect rider of 50,000 Initial monthly
premium 11.88

Total initial monthly premium 61.28
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CI Protect Family Protection Case Study

• By adding CI Protect rider to the insurance
  package, for 11.88/month, i.e. less than 0.40
  a day, John can protect his family from the 4
  most common critical illness conditions -
  cancer, heart attack, stroke and coronary bypass
  surgery

• The critical illness benefit can replace loss or
  reduction of income and help pay for
• Living expenses
• Unexpected expenses, e.g. travel or child care,
  that arent covered by public or employer health
  plans
• Etc.

Premium amount shown is the initial premium as
of July 6, 2016, for 50,000 CI Protect rider of
male 35 non-smoker. It will remain the same for
the first 10 years and will increase every 10
years thereafter. Based on Munich Re 2014
Individual Insurance Survey.
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Key Messages
Simple, Affordable Solution for Critical Illness
Protection Covers the four most common critical
illnesses with affordable premium rates A simple
application process that uses life insurance
underwriting with no additional health insurance
requirements Incorporates a coverage enhancement
opportunity within our Fast Full Life
Application process
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One more thing
Empire Life Southwestern Ontario
Roadshow September 21 Windsor Caesars Palace,
9am to 12pm September 22 - London Cineplex
Wonderland Rd, 9am-12pm Registration link
re-sent today or e-mail Eufrazia.andrade_at_empire.c
a
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• QUESTIONS?

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