Inforce Illustration Capability Policies issued by American General
Inforce Illustration Capability Policies issued by American General Life Insurance Company (AGL), Houston, TX, and The United States Life Insurance Company in the City of New York (US Life), members of American International Group, Inc. FOR FINANCIAL PROFESSIONAL USE (AIG) ONLY-NOT FOR PUBLIC DISTRIBUTION FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
What is happening? § Beginning 10/26/2018, real-time inforce illustration functionality on certain UL products will become available on Win. Flex Web. § Actively appointed partners/agents, and licensed agents who manage inforce UL business will be authorized to run inforce illustrations for their clients on Win. Flex Web. § This upgrade supplements the existing process for manually requesting inforce illustrations from AIG, and receiving them at a later date to review with clients. 2 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Why Are Inforce Illustrations Important? § Policy Reviews—Inforce illustrations can be a cornerstone in discussions with the client during a policy review to help them understand: – If policy performance is on track with the original illustration – If the premiums and performance have generated enough cash value, can the client potentially lower premiums or stop premium payments? – Is the current death benefit in line with current needs? – If their outlook has changed since the initial purchase in regards to premium schedule, premium allocation, and access to cash values. 3 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Inforce Illustrations Provide Insight § Helps client see and understand many things about their policy: – Is current premium in line with original objectives? – Is current performance supporting the policy as intended? • Help clients understand that interest and index cap and participation rates will and do change periodically – Have any premium payments been missed or paid late and what is the policy impact? – Is the current coverage adequate based on original goals? If original goals changed, how does that impact the coverage needed? – Is there enough cash value to access for specific needs? 4 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Inforce Insights on Funding Levels § A new business illustration on a UL or an IUL is based on a certain rate of return or index interest rate credited to the policy’s account value § But, an inforce illustration is in part actual experience and a future hypothetical based on – The timing of premium payments, – Rates credited to an account based on performance of an index or indices, or the declared rate – Changes to cap or par rates – Withdrawals or policy loans, if accessed and not illustrated originally § The original “as sold” illustration or quote was based on several of the above factors however, as time passes one or more of these factors may have changed and may impact the performance of the policy. 5 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Inforce Insights on Funding Levels What can an underfunded IUL or GUL look like and can you adjust to mitigate potential issues? § The inforce illustration may not run to the intended age or year (age 100, 110 or 121) compared to the “as sold” quote or illustration – Option is to increase premium, increase the years to pay premium or decrease the death benefit § The inforce illustration cap or par rate has changed impacting the length of time the policy will run – Option is to increase the premium, increase the years to pay premium or decrease the death benefit, change the death benefit option to level if increasing § The disbursement generated in the inforce illustration is less than the original “as sold” illustration – Option is to increase the premium, if DB option is increasing change to level, shorten the disbursement period and/or decrease the death benefit 6 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
What products are available? Inforce Illustration Products on Win. Flex Web Available for Distribution No Longer Distributed Qo. L Guarantee Plus GUL II Elite UL (2008) AG Secure Lifetime GUL Qo. L Value+ Protector Elite Index UL (2008) AG Secure Lifetime GUL 2 Qo. L Max Accumulator+ Contin. UL Elite Global Plus Secure Lifetime GUL 3* Contin. UL 2010 Elite Global Plus II Value+ Protector Contin. UL Extend Elite Global Survivor Max Accumulator+ Contin. UL Extend Plus AG Choice Index AG Extend IUL AG Choice Index (2013) § More products will be added on an ongoing basis § If you need an inforce illustration for a product not on this list, follow current practice to obtain * AGL and USL Product Versions FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION 7
Key Points § Available via Win. Flex Web only—Not available in Win. Flex Desktop § User will need Policy Number and Agent ID to generate inforce illustration § The Agent ID must be the agent of record to the corresponding policy number § Remember—Inforce illustrations are not available until after the first policy anniversary 8 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
How to Access § Login to Win. Flex Web with your current username and password § Once logged in, click the Illustrations Shortcut: 9 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
How to Access § Next, place curser over the Clients drop down menu at the top of the screen and select Inforce: 10 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Home Office View § When running as a Home Office user, simply enter the policy number then click Submit to load the policy information: 11 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Field/Agent View § When running as a Field user, you must enter the policy number AND Agent ID then click Submit to load the policy information: 12 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Invalid Agent ID § If the incorrect Agent ID is entered the following message will appear: REMEMBER: THE AGENT ID MUST BE THE AGENT OF RECORD FOR THE POLICY NUMBER ENTERED FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION 13
Finding Your Agent ID § If you need help finding your Agent ID, it can be accessed via e. Station § First, login to e. Station: 14 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Finding Your Agent ID § Choose “Inforce” at the top of the page § Select “Inforce Lookup” 15 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Finding Your Agent ID § Enter the policy number then click “Search” § The Agent ID number will be located in the lower right hand corner of the Summary for the Active Policy 16 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Running the Inforce Illustration § Notice the product and insured info cannot be changed on an Inforce Illustration: 17 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Inforce Illustrations—Solve For Tab § The system defaults to running the illustration “as-is” § The Solve For tab automatically has the policy face amount and scheduled premium input § Either of these can be adjusted to show alternate scenarios to the client *Some features on each tab may be different depending on the product being illustrated. FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION 18
Inforce Illustrations—Solve For Tab § Like a new business illustration, you may choose to solve for Face Amount or Premium to show alternate scenarios to the client *Some features on each tab may be different depending on the product being illustrated. FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION 19
Inforce Illustrations—Solve For Tab § Solve For Face Amount: The premium amount and schedule can be adjusted here to see what impact paying a different premium and/or stopping premiums at a specific time has on the death benefit *Some features on each tab may be different depending on the product being illustrated. FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION 20
Inforce Illustrations—Solve For Tab § Solve For Premium: The face amount and schedule can be adjusted here to see what impact adjusting the face amount and/or stopping premiums at a specific time has on the required premiums *Some features on each tab may be different depending on the product being illustrated. FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION 21
Inforce Illustrations—Index Strategy Tab § Strategy allocation is automatically set to the current allocation percentages § The allocation percentages and illustrative rates can be adjusted, like on a new business illustration § Due to maximum illustrative rate guidelines the maximum allowable illustrative rate may be higher or lower than what was on the original new business illustration *Some features on each tab may be different depending on the product being illustrated. FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION 22
Inforce Illustrations—Disbursements Tab § Disbursements can also be shown on an inforce illustration, just like a new business illustration—with all of the same inputs required to show the income *Some features on each tab may be different depending on the product being illustrated. 23 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Inforce Illustrations—Policy Options Tab § Here you can change the death benefit option, premium payment mode, and/or illustrate a lump sum being applied § Note the 1035 fields cannot be altered *Some features on each tab may be different depending on the product being illustrated. 24 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Inforce Illustrations—Riders Tab § Riders that are not available to be added post-issue will not be available for selection *Some features on each tab may be different depending on the product being illustrated. FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION 25
Inforce Illustrations—Inforce Tab § The inforce tab displays important policy information and cannot be changed *Some features on each tab may be different depending on the product being illustrated. FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION 26
Inforce Illustration Output § Once the information is entered as desired, the inforce illustration can be calculated to view § Inforce illustration can be reviewed, saved, or edited just like a new business illustration 27 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Thank YOU! FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Appendix RIDER AVAILABILITY MAY VARY BY STATE 29 FOR FINANCIAL PROFESSIONAL USE ONLY – NOT FOR PUBLIC DISTRIBUTION. FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Brief Description of Products Inforce Illustration Products on Win. Flex Web Available for Distribution Qo. L Guarantee Plus GUL II GUL with flexibility, guaranteed CVs & ROP (year 20 or 25), with Qo. L ABRs Qo. L Value+ Protector Protection focused IUL with life expectancy guarantees & Qo. L ABRs Qo. L Max Accumulator+ Accum focused IUL with 4 index accounts, AVE’s, and Qo. L ABRs Secure Lifetime GUL 3* GUL with flexibility, guaranteed CVs & ROP (year 20 or 25) Value+ Protector Protection focused IUL with life expectancy guarantees Max Accumulator+ Accum focused IUL with 4 index accounts, AVE’s AG Extend IUL built for term conversions, limited NLG, par & cap rate accounts 30 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Brief Description of Products Inforce Illustration Products on Win. Flex Web No Longer Distributed Elite UL (2008) Classic current assumption UL Elite Index UL (2008) IUL with Choice Loans Contin. UL GUL Contin. UL 2010 Low Cost GUL, strong DB guarantees Contin. UL Extend GUL with flexible guarantee period Contin. UL Extend Plus GUL with cash accumulation for future flexibility 31 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Brief Description of Products Inforce Illustration Products on Win. Flex Web No Longer Distributed AG Secure Lifetime GUL with guaranteed CV & ability to access CV without losing guarantee AG Secure Lifetime GUL 2 GUL with continuation guarantee, optionality, & year 20 ROP Elite Global Plus Accumulation IUL with 5 year global index (S&P 500, Hang Seng, Euro. Stoxx 50) Elite Global Plus II Accumulation IUL with 5 year global index and 1 year S&P 500 index Elite Global Survivor 2 nd to die IUL with 5 year global index AG Choice Index Hybrid GUL/IUL with 5 year global index, 1 year S&P 500 index AG Choice Index (2013) Hybrid GUL/IUL with 5 year global index, 1 year S&P 500 index, Choice Loans 32 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Carriers mentioned in the presentation are peer group competitors of American General Life. Every attempt has been made to verify the accuracy of competitor information included in this presentation. Product information and rates are subject to change at any time. Policies issued by American General Life Insurance Company (AGL), Houston, TX except in New York, where issued by The United States Life Insurance Company in the City of New York (US Life). Policy Form Numbers: 15646, ICC 15 -15646, 15646 N, 15442, ICC 15 -15442, 15442 NU, 16760, ICC 16 -16760, 16760 N, 12436, ICC 12 -12436, 12436 NU ; Rider Form Numbers: 13600 -5, 15600 -7, 15600, ICC 15 -15600, 15600 -5, 13601, ICC 13 -13601, 82012, 82410, 88390, 14002, ICC 14 -14002, 14306, 07620, 15997, 15996, 15271, ICC 15 -15271, 15274, ICC 15 - 15274, 15272, ICC 15 -15272, 15273, ICC 15 -15273 Issuing companies AGL and US Life are responsible for financial obligations of insurance products and are members of American International Group, Inc. (AIG). Guarantees are backed by the claims-paying ability of the issuing insurance company. Products may not be available in all states and product features may vary by state. Please refer to your policy. For additional information, please visit our website at www. aig. com. All products and services are written or provided by subsidiaries or affiliates of American International Group, Inc. Products or services may not be available in all countries, and coverage is subject to actual policy language. This information is general in nature, may be subject to change, and does not constitute legal, tax or accounting advice from any company, its employees, financial professionals or other representatives. Applicable laws and regulations are complex and subject to change. Any tax statements in this material are not intended to suggest the avoidance of U. S. federal, state or local tax penalties. For advice concerning your individual circumstances, consult a professional attorney, tax advisor or accountant. © AIG 2018. All rights reserved. AGLC 112055 FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Information about the ML Strategic Balanced Index® The ML Strategic Balanced Index® provides systematic, rules-based access to the blended performance of two underlying indices—the S&P 500 (without dividends), which serves to represent equity performance, and the Merrill Lynch 10 -year U. S. Treasury Futures Total Return Index, which serves to represent fixed income performance. To help manage overall return volatility, the Index may also systematically utilize cash performance in addition to the performance of the two underlying indices. Important Note: The ML Strategic Balanced Index® embeds an annual index cost in the calculations of the change in Index Value over the Index Term. This “embedded index cost” will reduce any change in Index Value over the Index Term that would otherwise have been used in the calculation of index interest, and it funds certain operational and licensing costs for the index. It is not a fee paid by you or received by the Company. The Company’s licensing relationship with Merrill Lynch, Pierce, Fenner & Smith Incorporated for use of the ML Strategic Balanced Index and for use of certain service marks includes the Company’s purchase of financial instruments for purposes of meeting its interest crediting obligations. Some portion of those instruments will, or may be, purchased from Merrill Lynch, Pierce, Fenner & Smith Incorporated or its Affiliates. Merrill Lynch, Pierce, Fenner & Smith Incorporated and its affiliates (“Bof. A Merrill Lynch”) indices and related information, the name “Bof. A Merrill Lynch”, and related trademarks, are intellectual property licensed from Bof. A Merrill Lynch, and may not be copied, used, or distributed without Bof. A Merrill Lynch’s prior written approval. The products of licensee American General Life Insurance Company have not been passed on as to their legality or suitability, and are not regulated, issued, endorsed, sold, guaranteed, or promoted by Bof. A Merrill Lynch. BOFA MERRILL LYNCH MAKES NO WARRANTIES AND BEARS NO LIABILITY WITH RESPECT TO ANY INDEX, ANY RELATED INFORMATION, ITS TRADEMARKS, OR THE PRODUCT(S) (INCLUDING WITHOUT LIMITATION, ITS QUALITY, ACCURACY, SUITABILITY AND/OR COMPLETENESS). The ML Strategic Balanced Index (the “Index”) is the property of Merrill Lynch, Pierce, Fenner & Smith Incorporated, which has contracted with S&P Opco, LLC (a subsidiary of S&P Dow Jones Indices LLC) to calculate and maintain the Index. The Index is not sponsored by S&P Dow Jones Indices or its affiliates or its third party licensors (collectively, “S&P Dow Jones Indices”). S&P Dow Jones Indices will not be liable for any errors or omissions in calculating the Index. “Calculated by S&P Dow Jones Indices” and the related stylized mark(s) are service marks of S&P Dow Jones Indices and have been licensed for use by Merrill Lynch, Pierce, Fenner & Smith Incorporated. Note that the ML Strategic Balanced Index™ is not available for policies issued in the State of New York. Information about the S&P 500® Index The S&P 500 Index is a product of S&P Dow Jones Indices LLC (“SPDJI”), and has been licensed for use by AGL and US Life. Standard & Poor’s®, S&P® and S&P 500® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”); and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by AGL and US Life’s Max Accumulator+ is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, their respective affiliates, and none of such parties make any representation regarding the advisability of investing in such product(s) nor do they have any liability for any errors, omissions, or interruptions of the S&P 500 Index. FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
Information about the PIMCO Global Optima Index TM (the “Index”) is a comprehensive equity and bond index, offering exposure to global equity and U. S. fixed income markets. The Index is a trademark of Pacific Investment Management Company LLC (“PIMCO”) and has been licensed for use for certain purposes by American General Life Insurance Company with select life insurance and annuity products. The Index is the exclusive property of PIMCO and is made and compiled without regard to the needs, including, but not limited to, the suitability or appropriateness needs, as applicable, of the Company, the Product, or owners of the Product. The Product is not sold, sponsored, endorsed or promoted by PIMCO or any other party involved in, or related to, making or compiling the Index. PIMCO does not provide investment advice to the Company with respect to the Product or to owners of the Product. Neither PIMCO nor any other party involved in, or related to, making or compiling the Index has any obligation to continue to provide the Index to the Company with respect to the Product. Neither PIMCO nor any other party involved in, or related to, making or compiling the Index makes any representation regarding the Index, Index information, performance, annuities generally or the Product particularly. PIMCO disclaims all warranties, express or implied, including all warranties of merchantability or fitness for a particular purpose or use. PIMCO shall have no responsibility or liability whatsoever with respect to the Product. The Licensed PIMCO Licensed Index is comprised of a number of constituents, some of which are owned by entities other than PIMCO. The Licensed PIMCO Indices rely on a variety of publically available data and information and licensable equity and fixed income sub-indices. All disclaimers referenced in the Agreement relative to PIMCO also apply separately to those entities that are owners of the constituents of the Licensed PIMCO Indices. The constituents of the Licensed PIMCO Indices include: MSCI Inc. , FTSE International Limited, FTSE TMX Global, Debt Capital Markets, Inc. , Frank Russell Company and certain ETFs. The Licensee expressly agrees to include the following disclaimer and limited language in connection with the use of the Licensed PIMCO Indices for the Permitted Purposes. FOR FINANCIAL PROFESSIONAL USE ONLY-NOT FOR PUBLIC DISTRIBUTION
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