Insurance products are issued by John Hancock Life
Insurance products are issued by: John Hancock Life Insurance Company (U. S. A. ), Boston, MA 02116 (not licensed in New York) and John Hancock Confidential. Life Insurance Company of New York, Valhalla, NY 10595. For internal use only. MLINY 022614157 08/15 For agent use only. Not for use with the public. of 13
Why LTC? At least 70% of people over age 65 will require LTC services at some point in their lives 1 78 million baby boomers will retire over the next two decades 2 One year of full-time care averages $94, 0003 1. U. S. Department of Health and Human Services, National Clearinghouse for Long-Term Care Information, www. longtermcare. gov, September 2010. 2. American Association for Long-Term Care Insurance, 2013 LTCi Sourcebook. 3. Based on the John Hancock 2013 Cost of Care Survey conducted by Life. Plans, Inc. Costs rounded to the nearest dollar. For agent use only. Not for use with the public. 2 of 13
Combining Life with LTC • Turns Death Benefit into Benefit Pool • Specify the exact amount of LTC coverage needed (from 1%-100% of the initial face amount) • Benefits ultimately paid whether needed LTC or not How the LTC Rider Works Premiums Policy owner chooses maximum acceleration percentage of 1, 2, or 4% of the face amount For agent use only. Not for use with the public. Life & LTC Benefit “Pool” Any portion of benefit not accelerated is paid to beneficiaries as Death Benefit Monthly LTC Acceleration 3 of 13
The John Hancock Advantage: Experience & Design • John Hancock has paid over $4. 7 billion in LTC insurance claims – To over 80, 000 claimants • The “Reimbursement” model helps keeps rider costs down & helps clients preserve their benefit pool – Indemnity riders are generally more expensive – And they are typically restricted by the IRS per diem limit For agent use only. Not for use with the public. 4 of 13
Other Benefits of John Hancock’s LTC Rider üSimple to qualify for the benefit üBenefit payments not subject to IRS “per diem” limit üFavorable tax treatment üRider rates guaranteed not to increase üExperienced Claims Support üGenerally less expensive For agent use only. Not for use with the public. 5 of 13
John Hancock’s Price Advantage Female 65, Preferred Non-smoker, $750, 000 Death Benefit, Full-Pay for Lifetime Premium without Rider Additional Cost for Rider Premium with Rider Initial Maximum Monthly Benefit Protection UL $12, 295 +8% $13, 287 $15, 000 Prudential $13, 555 +19% $16, 549 $9, 900 Nationwide $13, 570 +22% $16, 596 $9, 900 Protective $13, 981 +22% $16, 994 $9, 900 AXA $15, 821 +23% $19, 469 $15, 000 Competitor information is current and accurate to the best of our knowledge as of August 2015. The data shown is taken from various company illustrations. Current interest rates may be different for each company and may not be guaranteed. The comparisons in this communication are of different products which vary in premiums, rates, fees, expenses, features and benefits. These comparisons cannot be used with the public and complete personalized policy illustrations for each representative company must be presented or discussed with your clients. Please have your clients consult with their professional advisors to find out which type of life insurance is most suitable. Prudential, Protective, and Nationwide’s products are guaranteed for lifetime. Protection UL is guaranteed to age 86 and AXA to age 80, both are solving to endow at age 121 assuming current charges and current interest rates. Protective, Prudential and Nationwide maximum monthly LTC benefits limited to the IRS per diem limit, currently $330 per day, or $9, 900 per month. AXA’s maximum monthly LTC benefit is limited to 2 x the IRS per diem limit. The IRS per diem limit may be adjusted annually for inflation by the IRS. Prudential and Protective’s riders are not qualified LTC riders under IRC code 7702 B(b). For agent use only. Not for use with the public. 6 of 13
LTC Rider - New & Improved LTC Rider rates are unchanged and remain guaranteed. • Additional Benefit Pool Choices – Choose from 1% to 100% of the initial face amount – Allows clients to choose the coverage that is right for them – And allows you to include LTC coverage on policies over $5 million • Death Benefit Option 2 Available – Allows clients to optimize their retirement income solutions and cover their LTC needs • Ability to Illustrate LTC Rider Claims More Coverage. More Choices. More Consumer Value. For agent use only. Not for use with the public. 7 of 13
LTC Rider – More Benefit Pool Choices • Additional Benefit Pool Choices – Now clients can choose percentage (1% to 100% of DB) that is available for acceleration • More flexibility for large cases and legacy planning – Clients can choose the DB and LTC coverage that is just right for them Male, 65, Standard Plus, $1. 2 M Death Benefit Need, $300 K LTC need Old John Hancock LTC Rider NEW John Hancock LTC Rider Death Benefit LTC Pool $1, 2 00, 000 $3 00, 000 MAP 1% 4% MMBA Premium $ 12, 000 $ 30, 689 $ 29, 238 Savings of 5% This is a supplemental illustration. Not all benefits and values are guaranteed. The assumptions on which the non-guaranteed elements are based are subject to change by the insurer. Actual results may be more or less favorable. Examples based on level-pay premium solving for $1 at age 121. 6% illustrated rate. For agent use only. Not for use with the public. 8 of 13
LTC Rider – Death Benefit Option 2 • Death Benefit Option 2 available with LTC rider – LTC pool equals client’s chosen percentage of the initial face • More flexibility for Retirement Income Cases – Clients no longer need to choose between covering LTC and maximizing income Female 45, Preferred, $25, 000 per year for 20 years, 2% LTC, Death Benefit Option 2 Company Income Cash Value Year 20 Initial MMBA Nationwide $76, 380 $835, 348 $9, 900 John Hancock Accumulation IUL $64, 474 $812, 938 $15, 000 Minnesota Life $61, 758 $793, 297 $9, 900 AXA $60, 488 $787, 335 $15, 000 Example based on taking maximum monthly distributions in years 21 -40, solving for $1 at age 121. $750, 000 death benefit switching from option 2 (increasing death benefit) to option 1 (level death benefit) in optimal year. . Income assumes withdrawal to basis and then taking Standard Loans. The data shown is taken from various company illustrations. All competitors’ illustrated at 6%. All products shown assume a one-year point-to-point crediting option on the underlying index. These values are not guaranteed. Competitor information is current and accurate to the best of our knowledge as of August 2015. The comparisons in this communication are of different products which vary in rates, fees, expenses, features and benefits. These comparisons cannot be used with the public and complete personalized policy illustrations for each representative company must be presented or discussed with your clients. Please have your clients consult with their professional advisors to find out which type of life insurance is more suitable. For agent use only. Not for use with the public. 9 of 13
Comparing Rider Types Non-Qualified Who sells them Benefit Qualification Qualified Indemnity Reimbursement Lincoln, Pacific Life, Penn Mutual, Protective, Prudential AXA, Minnesota Life, Nationwide, Transamerica John Hancock • Cannot perform 2 of 6 ADLs, cognitive impairment • Condition must be permanent • Annual recertification required • Cannot perform 2 of 6 ADLs, cognitive impairment Subject to IRS “per diem” limit of $9, 900 per month** Yes No Rider charges can be taxable Yes No No LTC Rider rates guaranteed No* Yes *Lincoln and Transamerica rider rates are guaranteed. **Some companies with indemnity riders allow for accelerations above the per diem limit, but those accelerations are subject to taxation to the extent they exceed actual costs incurred by the policyholder. For agent use only. Not for use with the public. 10 of 13
John Hancock vs. Pacific Life • Pacific Life’s chronic illness rider is available free of charge … Unless You Use it – In the event of a claim, Pacific Life’s death benefit is reduced by more than the amount of the claim – JH death benefit reduces only by the amount of the claim Female, Age 60, Preferred Non Smoker, $500, 000 Death Benefit; 2% LTC claim effective year 10 Death Benefit Reduction Maximum Annual LTC Benefit Pool Lost Upon Acceleration John Hancock $120, 000 $0 Pacific Life $120, 000 $56, 639 -$63, 361 Pacific Life reduces the death benefit by the full $120, 000, but the client only receives $56, 639. The remaining $63, 361 is lost! Based on Pacific Life Indexed Performer LT with 50% blend, level-pay solve to 1 at lifetime, 6% assumed rate of return, level-pay premium ceasing when claims begin. Competitor information is current and accurate to the best of our knowledge as of August 2015. The data shown is taken from company illustrations. Current rates may be different for each company and may not be guaranteed. For agent use only. Not for use with the public. 11 of 13
John Hancock vs. Nationwide • John Hancock’s rider is often much less expensive • Nationwide’s approach depletes cash values much faster – – John Hancock: Claims reduce cash value proportionally to reduction in death benefit Nationwide: Claims reduce cash value equal to amount of claim John Hancock and Nationwide IULs: Male, 55, Preferred, $500, 000 Death Benefit, 6% assumed rate of return 2% LTC Rider Paying $15, 000 for 10 years Cash Value Comparison: Assume 2% Acceleration for 12 months, beginning in year 21 Before Claim After Claim (CSV Year 20) (CSV Year 21) John Hancock $198, 496 Nationwide $237, 946 Accelerate $120, 000 $154, 912 $130, 994 Competitor information is current and accurate to the best of our knowledge as of August 2015. The data shown is taken from various company illustrations. The comparisons in this communication are of different products which vary in premiums, rates, fees, expenses, features and benefits. These comparisons cannot be used with the public and complete personalized policy illustrations for each representative company must be presented or discussed with your clients. Please have your clients consult with their professional advisors to find out which type of life insurance is more suitable. Examples based on illustrated rate of 6%. The hypothetical rate of return is in not guaranteed and actual results may be more or less favorable. For agent use only. Not for use with the public. 12 of 13
Disclosures Insurance policies and/or associated riders and features may not be available in all states. Guaranteed product features are dependent upon minimum premium requirements and the claims-paying ability of the issuer. The Long-Term Care (LTC) rider is an accelerated death benefit rider and may not be considered long-term care insurance in some states. There additional costs associated with this rider. The Maximum Monthly Benefit Amount is $50, 000. When the death benefit is accelerated for longterm care expenses it is reduced dollar for dollar, and the cash value is reduced proportionately. [Please go to www. jhsalesnet. com to verify state availability]. This rider has exclusions and limitations, reductions of benefits, and terms under which it may be continued in force or discontinued. Consult the state specific Outline of Coverage for additional details. LIMITATIONS ON OR CONDITIONS FOR ELIGIBILITY FOR PAYMENT OF BENEFITS Limitations. We will not pay Accelerated Benefits for Qualified Long Term Care Services incurred during the Elimination Period, or for any care, treatment, or charges described in the Non-Duplication of Benefits or Exclusions provisions, below. We will not pay Accelerated Benefits in excess of the Maximum Monthly Benefit Amount for any Calendar Month during any Period of Care, and may modify coverage under this rider following reinstatement. Exclusions. Qualified Long Term Care Services does not include care or treatment: (a) for intentionally self-inflicted injury; (b) required as a result of alcoholism or drug abuse (unless drug abuse was a result of the administration of drugs as part of treatment by a Physician); (c) due to war (declared or undeclared) or any act of war, or service in any of the armed forces or auxiliary units; (d) due to participation in a felony, riot or insurrection; (e) for which no charge is normally made in the absence of insurance; (f) provided by a member of the Life Insured’s Immediate Family; (g) provided outside the fifty United States and the District of Columbia. Non-Duplication of Benefits. Qualified Long Term Care Services does not include charges covered under any of the following: (a) Medicare (including amounts that would be reimbursable but for the application of a deductible or coinsurance amounts); (b) any other governmental program (except Medicaid); (c) any state or federal workers’ compensation, employer’s liability or occupational disease law, or any motor vehicle no-fault law; (d) expenses for services or items available or paid under another long term care insurance or health insurance policy. Insurance products are issued by: John Hancock Life Insurance Company (U. S. A. ), Boston, MA 02116 (not licensed in New York) and John Hancock Life Insurance Company of New York, Valhalla, NY 10595. For agent use only. Not for use with the public. 13 of 13
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