Allianz Life Insurance Company of North America
For financial professional use only – not for public distribution.
Corey J. Luke CHFC, CLU Sr. Director, Life Products Innovation
FIUL - Industry Update
PPT-253 2/2016
For financial professional use only – not for public distribution.
1. Industry Overview – 2015 2. Life Insurance Regulation 3. IUL – Product Developments 4. Competitive Positioning – Top 5
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Agenda
1 Industry Overview
For financial professional use only – not for public distribution.
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2015 Life Insurance Sales – Recurring Premium YTD
21%
32% 17%
6%
23%
Total Life Insurance Market $11.1 Billion
Term
Whole Life
Fixed UL
Variable UL
Indexed UL
Source: 4Q 2015 LIMRA’s U.S. Retail Individual Life Insurance Sales by Channel with All Splits
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2015 Life Insurance Sales - Recurring Premium YTD
2015 YTD percent change from 2014 YTD
Total Industry +6%
VUL -3%
Indexed UL +15% Whole Life +9%
Fixed UL -2%
Term +2%
Source: 4Q 2015 LIMRA’s U.S. Retail Individual Life Insurance Sales by Channel with All Splits
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IUL Growth 2005-2015
Source: 4Q 2015 Wink Report
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Year to Date Top 10 FIUL Carriers Sales – Total Distribution in millions
2014 Rank
2015 Rank Carrier
Recurring Premium
4Q 2015YTD
Market Share (rounded)
# of Policies 4Q
2015 YTD
1 1 Pacific Life 366,741 15% 9,091
3 2 Transamerica 282,892 12% 105,107
2 3 Minnesota Life 230,186 10% 10,602
4 4 National/LSW 152,818 6% 41,085
7 5 Nationwide 132,525 5% 15,159
5 6 Allianz Life 129,137 5% 5,244
9 7 Penn Mutual 101,588 4% 3,969
16 8 Voya Financial 100,082 4% 4,673
13 9 AXA 98,117 4% 8,603
9 10 North American 93,589 4% 11,048
Total Distribution Sales 2,416,006
Source: 4Q 2015 LIMRA’s U.S. Retail Individual Life Insurance Sales by Channel with All Splits Preliminary Results
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Year to Date Top 10 FIUL Carriers Sales – Independent Agent in millions
2014 Rank
2015 Rank Carrier
Recurring Premium
4Q 2015YTD
Market Share (rounded)
# of Policies 4Q
2015 YTD
1 1 Pacific Life 315,287 19% 8,305
2 2 Minnesota Life 192,322 12% 5,837
3 3 Allianz Life 129,137 8% 5,244
5 4 Nationwide 107,630 6% 11,930
11 5 Voya 100,082 6% 4,673
7 6 National/LSW 97,126 6% 29,750
5 7 North American 93,589 6% 11,048
8 8 Midland 90,263 5% 11,925
10 9 Penn Mutual 77,661 5% 1,852
9 10 John Hancock 64,736 4% 2,392
Total Independent Sales 1,659,338
Source: 4Q 2015 LIMRA’s U.S. Retail Individual Life Insurance Sales by Channel with All Splits Preliminary Results
2 Life Insurance Regulation
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Regulatory Changes – Life Insurance
Actuarial Guideline 49 (Phases I and II)
DOL Fiduciary Rule
New CSO Table
Premium Based Reserves (PBR)
AG49 Phase III and Beyond
3 Product Development Trends (IUL)
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Index Innovation - Select Index Options - “Volatility Controlled” Index Options
Bonus Innovation
- Guaranteed Bonuses/Costs Comparison Spread Death Benefit Options Living Benefits
Accelerated UW Programs
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FIUL Product Development
4 Competitive Positioning
“Allianz Top 5”
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Allianz Life Pro+ ADVANTAGES
Innovative Index Allocations
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Index Allocation Options - Industry
Source: 4Q 2015 Wink Report
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Allianz Life Pro+ ADVANTAGES
Sweep Dates
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Allianz Life Pro+ ADVANTAGES
Loan choices and FLEXIBILITY Blended loan (indexed and fixed) Distinct loan value allocation Indexed loan charge – guaranteed!
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Loan flexibility vs. the competition
¹The frequency of switching loan types varies by carrier ²Pacific Life refers to indexed loans as alternate loans. The rate is not guaranteed. ³With Voya, clients can only switch loan types once, and only from indexed loans to fixed loans.
Companies Participating loans (indexed/variable)
Guaranteed Participating loan rate
Ability to switch between loan types¹
Ability to allocate loaned and unloaned
values differently
Allianz Life Pro+ Yes Yes Yes Yes
Minnesota Life Eclipse Indexed Life Policy Yes Yes Yes No
Pacific Life Pacific Indexed Performer LT Yes² No Yes No
National Life/LSW FlexLife IUL Yes No Yes No
North American Builder IUL Yes No Yes No
Voya Indexed Universal Life – Global choice Yes Yes Yes³ No
Nationwide YourLife Indexed Universal Life No n/a n/a No
John Hancock – Accumulation Indexed UL Yes No Yes No
Penn Mutual Yes Yes Yes No
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Allianz Life Pro+ ADVANTAGES
Accumulation Bonus (Multiplier) Design
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Is the bonus guaranteed? Companies S&P Cap Max Illustrated
Rate Guaranteed
Bonus
Allianz Life Pro+ 12.5% 7.09% Yes
Minnesota Life Eclipse Indexed Life Policy 12.5% 7.09% No
Pacific Life Pacific Indexed Performer LT 11% 6.48% No
National Life/LSW FlexLife IUL 12% 6.91% No
North American Builder IUL 13% 7.28% Yes
Voya Indexed Universal Life – Global choice 13% 7.28% N/A
Nationwide YourLife Indexed Universal Life 12% 6.86% Yes
John Hancock – Accumulation Indexed UL 11.50% 6.69% Yes
Penn Mutual 12% Floor 1% 7.20% Yes
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Allianz Life Pro+ ADVANTAGES
Loan Comparisons
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Income comparisons-Top FIUL Companies
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Assumption: 45M Pref Best, Paying 25K for 20 years, Increasing DB switching to Level year 21, Par loans year 21-40
Carrier Product Current IR Income Allianz Allianz Life Pro+ 7.09% 109,641
North American Builder IUL 7.28% 108,445
Minnesota Life Omega Builder 7.09% 103,312
Penn Mutual Accumulation Builder Adv. 7.20% 102,348
Minnesota Life Eclipse IUL 7.09% 98,197
National Life/LSW FlexLife IUL 6.91% 92,057
Voya Global Choice IUL 6.86% 90,022
John Hancock Accumulation IUL 15 6.69% 86,535
Pacific Life Pacific Indexed Performer LT 6.48% 83,918
For financial professional use only – not for public distribution.
Income comparisons-Top FIUL Companies
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Assumptions: 45M Pref Best, Paying 25K for 20 years, Increasing DB switching to Level year 21, Par loans year 21-40
Carrier Product Current IR Income Allianz Allianz Life Pro+ 6% 88,898
North American Builder IUL 6% 86,077
Minnesota Life Omega Builder 6% 83,189
Minnesota Life Eclipse IUL 6% 78,774
National Life/LSW FlexLife IUL 6% 77,303
Penn Mutual Accumulation Builder Adv. 6% 77,100
Pacific Life Pacific Indexed Performer LT 6% 75,804
John Hancock Accumulation IUL 15 6% 75,154
Voya Global Choice IUL 6% 61,652
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OUR MISSION: Allianz Life Insurance Company of North America is the trusted authority in insured retirement solutions for consumers working with a financial professional.
www.allianzlife.com
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Guarantees are backed by the financial strength and claims paying ability of Allianz Life Insurance Company of North America. Products are issued by Allianz Life Insurance Company of North America (P61843, P54350)
