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									    Sales Ideas & Marketing
    Concepts

                  …. That Work !!!


Robert G. Williams
VP of Annuity Training
            Today’s Agenda

• Why   Index Annuities
• How To Create Interest
• Which Crediting Method is Best

• 2 HOT Index Annuities…PLUS 1
       Where Would You Be Today?
         (12-31-99…12-31-04)

Year         Dow 30       S&P        Nasdaq


2000         $93,830     $89,860     $61,710
            (-6.17%)    (-10.14%)   (-38.29%)
2001         $87,168     $78,142     $48,720
            (-7.10%)    (-13.04%)   (-21.05%)
2002         $72,558     $59,880     $33,358
            (-16.76%)   (-23.37%)   (-31.53%)
2003        $90,930      $75,677     $50,038
           (+25.32%)    (+26.38%)   (+50.00%)
2004         $93,795     $82,480     $54,336
            (+3.15%)    (+8.99%)    (+8.59%)
Index Annuity vs. Market
   Hypothetical Index Performance
       (12-31-99…12-31-04)
Year    Dow 30       S&P        Nasdaq       Index
                                            Annuity
                                           (8% Cap)
2000    93,830       89,860      61,710    100,000
       (-6.17%)    (-10.14%)   (-38.29%)    (0%)
2001    87,168       78,142      48,720    100,000
       (-7.10%)    (-13.04%)   (-21.05%)    (0%)
2002     72,558      59,880      33,358    100,000
       (-16.76%)   (-23.37%)   (-31.53%)    (0%)


2003    90,930      75,677      50,038     108,000
       (25.32%)    (26.38%)     (50%)       (8%)


2004    93,795      82,480      54,336     116,640
       (3.15%)     (8.99%)     (8.59%)      (8%)
60% = 150%
               Index Annuity Sales

• 1997 Sales…$3+ Billion
• 1998 Sales…$4.2 Billion
• 1999 Sales…$5.15 Billion
• 2000 Sales…$5.25 Billion
• 2001 Sales…$6.5 Billion
•2002 Sales…$11.7 Billion
•2003 Sales…$14+ Billion
•2004 Sales…$22+Billion
Index Annuity Sales will Soar during next
         18 Months…WHY?

      Market Nervousness

       Low Interest Rates
What Are The 3 Things I Can Do With
              My $$$


•SPEND IT !!!
•SAVE IT!!!
•INVEST IT !!!
     What Consumers Want

Investments                       Savings



Potential                      Protection
Mutual Fund                        CD’s
   Bonds
                                Fixed Ann
Variable Ann      Fixed           T-Bill’s
   Stocks
               Index Annuity
What Is An Index
   Annuity?
  FIXED
IT IS A

ANNUITY
Fixed Index Annuity
  Savings Program
   Index Annuities Are Simply
   Fixed Annuities with An
 Interest Rate That Is Linked To
Guaranteed Bonds and a Leading
              Index
                      Fixed Annuity Contract Mechanics
                                     (Hypothetical Rates)
                                                                     Investments
  Premium                          Policy




                                                                    Investment Income



                                                                                        6.00%
 Expenses


                                                                     Interest Credits
Commissions



            Profits                                                                     4.00%
2.00%                 Guarantees
                                            Benefits
                               Death,Surrender, Nursing Home
                            Unemployment, Terminal Illness Riders
                           Fixed EIA Contract Mechanics
                                     ( Hypothetical Rates)
                                                                     Investments
  Premium                          Policy




                                                                    Investment Income



                                                                                        6.00%
 Expenses                                                             Index Options     4.00%
Commissions


                                                                      Option Payout
            Profits


2.00%                 Guarantees
                                            Benefits
                               Death,Surrender, Nursing Home
                            Unemployment, Terminal Illness Riders
Index Annuities Have Two
        Key Parts
  One Part is POTENTIAL
 One Part is PROTECTION
The Index Account is POTENTIAL
 The Contractual Guarantee’s are
         PROTECTION
        POWER PHRASE


The Purpose of your Contractual
 Guarantee’s (Bonds) is to
 PROTECT the POTENTIAL of
 your Index Account (Options)
              Index Annuity

• How Does it Really Work?
• The Stairway to Financial Peace of Mind
                       Year 5            Year 6


              Year 3            Year 4


     Year 1
                       Year 2


     $$$$
           Hypothetical Annual Reset


 Annual Reset                                           8% Cap
 locks in the gain.
                                                     Index account

               8% Cap
            Index Account
                                     Index Gains
                                      Locked IN
                                                       $116,640
                                                                         $
                                                                      Protection
              $108,000                $108,000
   Index                                                              What
   Rises                                                             happens
    10%                                      Index                     next
                                             Rises                    year?
                            Index             10%
                             Falls
                             10%                          Index
                                                           Falls
$100,000                                                   10%
            Index Annuity
             Hypothetical

    Year      Index Value         Min Guar %

1    (8%)     $108,000            $102,250
2    (5%)     $113,400            $104,550
3    (7%)     $121,338           $106,903
4    (0%)     $121,338           $109,308
5    (3%)     $124,978           $111,768
6    (6%)     $132,477           $114,282
7    (0%)     $132,477           $116,854
             Surrender Fee May   Surrender Fee Will
                   Apply               Apply
           Index Annuity

 Year    Index Acc’t     MGSV       Index Acc’t
                       100%@2.25%   No Market Gains

1 (8%)   $108,000      $102,250     $100,000
2 (5%)   $113,400      $104,550     $100,000
3 (7%)   $121,338      $106,903     $100,000
4 (0%)   $121,338      $109,308     $100,000
5 (3%)   $124,978      $111,768     $100,000
6 (6%)   $132,477      $114,282     $100,000
7 (0%)   $132,477      $116,854     $100,000
               Sailing the Waters of the
                     Stock Market




                                           Poor Market
Market Index         Financial Advisor     Performance
  $$$       $$$       $$$
Premium   Premium   Premium
       Monthly Average
        How It Works
         S&P 500 1,000
900           13,200
1000
1100           ÷12
1200
1000          =1,100
1200
1200          -1,000
1100
               =100
1200
1200          ÷ 1,000
1100
1000           =10%
  Point to Point
  How It Works

S&P 500 or Dow 30
   Mar 1, xx =1,000
  Feb 28, xx =1,100

       1,100
       -1,000
        =100
      ÷ 1,000

       =10%
              Monthly Average
               How It Works
               S&P 500 1,000
 900                13,200
1000
1100                 ÷12
1200
1000                =1,100
1200   1300
1200                 -1,000
1100
                     =100
1200
1200                ÷ 1,000
1100
1000   900           =10%
          Monthly Average
           How It Works
               S&P 500
             (Oct. 1, 2003)
               1018.22
1059.02       13,372.68
1070.12
1108.48
                 ÷12
1135.26       = 1114.39
1155.97
1132.17       - 1018.22
1117.49
1121.20        = 96.17
1128.94       ÷ 1018.22
1106.62
1105.91        = 9.44%
1131.50
          Annual Point to Point
             How It Works
                  S&P 500
                (Oct. 1, 2003)
                  1018.22
1059.02
1070.12
1108.48
1135.26          1131.50
1155.97
1132.17         - 1018.22
1117.49
1121.20          = 113.28
1128.94         ÷ 1018.22
1106.62
1105.91           = 11.1%
1131.50
              Calculating Monthly
                 Point to Point

              Date               S&P Value
              Oct. 1             1018.22
              Nov. 3             1059.02
• Subtract the starting value from the current
  value
• Divide the sum by the starting value
• Record the Index Change and New Starting point for
  the next month
          1059.02 – 1018.22 = 40.80
          40.80 ÷ 1018.22 = 4.0%

          Index Change for 1st month = 4.0%

          Starting point for 2nd month = 1059.02
                    Monthly Point to Point
                      One Year Option
       Date           S&P Closing Value     Percentage Change   Capped Increase*
October 1, 2003             1018.22                0%                 0%
November 3, 2003            1059.02              4.00%              3.00%
December 1, 2003            1070.12              1.04%              1.04%
January 2, 2004             1108.48              3.58%              3.00%
February 2, 2004            1135.26              2.42%              2.42%
March 1, 2004               1155.97              1.82%              1.82%
April 1, 2004               1132.17              -2.05%             -2.05%
May 3, 2004                 1117.49              -1.29%             -1.29%
June 1, 2004                1121.20              0.33%              0.33%
July 1, 2004                1128.94              0.69%              0.69%
August 2, 2003              1106.62              -1.98%             -1.98%
September 1, 2004           1105.91              -0.06%             -0.06%
October 1, 2004             1131.50              2.31%              2.31%
                   First Year   Credited Rate                        9.23%
                                                                    *3%Cap
Which Was PROBABLY More Beneficial To Consumer




•Monthly Point to Point…9.23%
•Monthly Average…9.44%
•Annual Point to Point…11.1%
                    Monthly Point to Point
                      One Year Option
       Date           S&P Closing Value     Percentage Change   Capped Increase*
October 1, 2003             1018.22                0%                 0%
November 3, 2003            1059.02              4.00%              3.00%
December 1, 2003            1070.12              1.04%              1.04%
January 2, 2004             1108.48              3.58%              3.00%
February 2, 2004            1135.26              2.42%              2.42%
March 1, 2004               1155.97              1.82%              1.82%
April 1, 2004               1132.17              -2.05%             -2.05%
May 3, 2004                 1117.49              -1.29%          -1.29% (+1%)
June 1, 2004                1121.20              0.33%              0.33%
July 1, 2004                1128.94              0.69%              0.69%
August 2, 2003              1106.62              -1.98%          -1.98% (+1%)
September 1, 2004           1105.91              -0.06%             -0.06%
October 1, 2004             1131.50              2.31%              2.31%
                   First Year   Credited Rate                   9.23% (+14.5%)
                                                                    *3%Cap
      Index Crediting Assumptions


• Monthly Point to Point Cap…3%
• Monthly Average Cap…10%
• Annual Point to Point Cap…9%
• Closing Prices on First Business Day
  of each Month
            1991 S&P Performance
  Dates        Index number   Monthly Change   Accrued
 January         330.20
February         343.91           4.18%        3.00%
 March           367.07           6.73%        3.00%
  April          375.22           2.22%        2.22%
  May            375.35           0.03%        0.03%
  June           389.81           3.85%        3.00%
  July           371.18          -4.78%        -4.78%
 August          387.81           4.48%        3.00%
September        395.43           1.96%        1.96%
October          387.86          -1.91%        -1.91%
November         392.46           1.19%        1.19%
December         375.11          -4.42%        -4.42%
 January         417.03          11.18%        3.00%
        Index Crediting Assumptions


• Monthly Point to Point Total…24.69%
  3% Monthly Cap Total…9.29%
  Credited Amount…9.29%
• Monthly Annual Average…15.54%
  10% Annual Cap Credited…10.00%
• Annual Point to Point …26.30%
  9% Annual Cap Credited…9.00%
            1995 S&P Performance
  Dates        Index number   Monthly Change   Accrued
 January         459.21
February         470.42           2.44%        2.44%
 March           487.39           3.61%        3.00%
  April          500.70           2.73%        2.73%
  May            514.75           2.81%        2.81%
  June           533.40           3.62%        3.00%
  July           544.75           2.13%        2.13%
 August          562.06           3.18%        3.00%
September        561.88          -0.03%        -0.03%
October          584.41           4.01%        3.00%
November         581.50          -0.50%        -0.50%
December         605.37           4.10%        3.00%
 January         615.93           1.74%        1.74%
        Index Crediting Assumptions


• Monthly Point to Point Total…29.84%
  3% Monthly Cap Total…26.32%
  Credited Amount…26.32%
• Monthly Annual Average…19.09%
  10% Annual Cap Credited…10.00%
• Annual Point to Point …34.13%
  9% Annual Cap Credited…9.00%
            1998 S&P Performance
  Dates        Index number   Monthly Change   Accrued
 January         970.43
February         980.28           1.02%        1.02%
 March           1,049.34         7.04%        3.00%
  April          1,101.75         4.99%        3.00%
  May            1,111.75         0.91%        0.91%
  June           1,080.82        -1.88%        -1.88%
  July           1,133.84         3.94%        3.00%
 August          1,120.67        -1.16%        -1.16%
September        957.28          -14.58%       -14.58%
October          1,017.01         6.24%        3.00%
November         1,098.67         8.03%        3.00%
December         1,163.63         5.91%        3.00%
 January         1,229.23         5.64%        3.00%
        Index Crediting Assumptions


• Monthly Point to Point Total…26.10%
  3% Monthly Cap Total…5.30%
  Credited Amount…5.30%
• Monthly Annual Average…12.10%
  10% Annual Cap Credited…10.00%
• Annual Point to Point …26.67%
  9% Annual Cap Credited…9.00%
            2003 S&P Performance
  Dates        Index number   Monthly Change   Accrued
 January         879.82
February         855.70          -2.74%        -2.74%
 March           841.15          -1.70%        -1.70%
  April          848.18           0.84%        0.84%
  May            916.92           8.10%        3.00%
  June           963.59           5.09%        3.00%
  July           974.50           1.13%        1.13%
 August          990.31           1.62%        1.62%
September        1,008.01         1.79%        1.79%
October          995.97          -1.19%        -1.19%
November         1,050.71         5.50%        3.00%
December         1,058.20         0.71%        0.71%
 January         1,111.92         5.08%        3.00%
        Index Crediting Assumptions


• Monthly Point to Point Total…24.22%
  3% Monthly Cap Total…12.45%
  Credited Amount…12.45%
• Monthly Annual Average…10.01%
  10% Annual Cap Credited…10.00%
• Annual Point to Point …26.38%
  9% Annual Cap Credited…9.00%
            2004 S&P Performance
  Dates        Index number   Monthly Change   Accrued
 January         1,108.48
February         1,131.13         2.04%        2.04%
 March           1,144.94         1.22%        1.22%
  April          1,126.21        -1.64%        -1.64%
  May            1,107.30        -1.68%        -1.68%
  June           1,120.68         1.21%        1.21%
  July           1,140.84         1.80%        1.80%
 August          1,101.72        -3.43%        -3.43%
September        1,114.58         1.17%        1.17%
October          1,120.27         0,51%        0.51%
November         1,130.88         0.95%        0.95%
December         1,177.14         4.09%        3.00%
 January         1,213.55         5.09%        3.00%
        Index Crediting Assumptions


• Monthly Point to Point Total…9.34%
  3% Monthly Cap Total…8.15%
  Credited Amount…8.15%
• Monthly Annual Average…2.46%
  10% Annual Cap Credited…2.46%
• Annual Point to Point …9.48%
  9% Annual Cap Credited…9.00%
       Potential vs. Protection

                  INDEX ANNUITY

                               $$
-40%    -20%       0%       +20%    +40%




               INVESTMENT
   Why Index Annuities

Investments     Savings Program

                         Participate in all or a
  + 40%                  portion of the S&P
                         and/or DJIA

                  $
                           +1.5%


  - 40%
INTRODUCING
Spectrum Rewards
   Choice 7&9
  Index Annuity
         It’s About CHOICES !!!!


• CHOICE of 2 Mid Range Surrender Schedules
• Trails
• Upfront Bonus
• Commissions to Match Surrender Schedules
                  Spectrum Choice Features

Product                        Spectrum Choice 7           Spectrum Choice 9


Issue Ages              0-85                        0-85
Index Crediting         Monthly Point-to-Point      Monthly Point-to-Point
                        Annual Point –to-Point      1,2,3 year Resets
                        Monthly Average
Term                    7 years                     9 years
Surrender               12,11,10,8,6,4,2            12,11,10,9,8,7,6,4,2


Free Withdrawals        10% of account value each   10% of account value each
                        year after the 1st year     year after the 1st year

MGSV                    1.5% of all premiums OR     1.5% of all premiums OR
                        Floating Rate               Floating Rate

Bonus                   None                        3% Upfront
Riders                  Death of Owner, terminal    Death of owner, terminal
                        illness, unemployment,      illness, unemployment,
                        nursing home                nursing home
Street Comp.            7% or 5.75% with Trails     9%
      Spectrum Rewards Choice 7&9
           Surrender Charges
• Apply to full and partial surrenders


• Waived In Index Account Upon…
    – Death of Owner - greater of Account Value or Minimum
      Guaranteed Surrender Value Available to Beneficiary
    – Terminal Illness
    – Unemployment
    – Nursing Home Confinement
    – Minimum Required Distributions (by company practice)
    – 10% free withdrawal after the first year
              Spectrum Rewards
                 Choice 7&9
   Minimum Guaranteed Interest Rate

• The minimum guaranteed interest rate MGSV (100%
  of initial premium, earning 1.5% interest or Floating
  Rate) is the contract provision that allows Index
  Annuity contract holders to not be exposed to the
  potential of losing principal if the market does not
  perform as expected
• Example - Initial premium of $100,000 with a MGSV
  of 100% earning 2.25%
         Spectrum Rewards
             Choice 7
Minimum Guaranteed Interest Rate


      Initial Premium          $100,000


        Years 1-7          Market Index Down


   Minimum Guaranteed
   Surrender Value after       $116,854
         7th year
         Spectrum Rewards
             Choice 9
Minimum Guaranteed Interest Rate


      Initial Premium          $100,000


        Years 1-9          Market Index Down


   Minimum Guaranteed
   Surrender Value after       $122,171
         9th year
          The Account Value Escalator

At the beginning of
each and every year,
for the first 6 years,
additional interest of
1% of the initial single
premium is added to
the account value. It
is guaranteed. It                      1%
cannot be lost to                 1%
changes in the index.        1%
                                       Additions of interest are eligible
                        1%             for the year-end index credits.
                   1%
              1%
             4%
          Commission




                         1
  5 Yr.                Moving
Surrender               Part
 Charge
                          6 Yr.
                        Surrender
                         Charge
  1
Moving
 Part




              1%                  4%
         Annual Bonus      Commission
           for 6 Yrs.
  7 Yr.
Surrender    Trails

 Charge




                        1
                      Moving
     7%                Part
Commission
            9%
         Commission
                                9 Yr.
                              Surrender
                               Charge
  1
Moving
 Part


                       3%
                      Bonus
A Consistent Winner…Year after Year!

								
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