Long Term Care Insurance as a Benefit

1. Long Term Care Insurance as a Benefit Presented to: Presented by: 124025 02/09/12 ©2012 Genworth Financial, Inc. All rights reserved.

2. Overview Need for Long Term Care in the Workplace Benefits for Employer and Employee Deductibility of Premiums Long Term Care Insurance and How It Works About Genworth Next Steps 1 2 3 4 5 6

3. 1 Need for Long Term Care in the Workplace

4. Primary Concerns An extended care “event” may have a dramatic impact on an individual’s retirement portfolio, as well as his or her family. “ How will I handle unexpected extended care expenses? Will I have enough income to sustain my lifestyle in the future? ”

5. People are living longer Average life expectancies continue to improve. Source: Population Reference Bureau, 2009 World Population Data Sheet, 2009.

6. The need for extended care is a reality. 3.9 2 3 4 7 out of to years 3 people1 years 2 People over 65 who will requirelong term care Average life expectancy after Alzheimer's diagnosis after age 70 Average length of majority of long term care claims 1 Source: U.S. Department of Health and Human Services National Clearinghouse for Long Term Care Information Website, May 2010 2 Source: Genworth Financial Claims Data, December 2010 3 Source: National Institute on Aging, National Institute of Health, 2/09

7. Extended care is expensive today… Cost of care for one year in the United States [$77,745] [$43,472] [$39,135] In-Home Care (44 hours/week) Assisted Living Nursing Home (private room) Source: Genworth 2011 Cost of Care Survey, conducted by CareScout ®, April 2011. Based on national median costs.

8. ...and will be even more expensive 15 years from now Future cost of care for one year in the United States* [$153,930] [$77,745] [$86,072] [$77,485] [$43,472] [$39,135] Assisted Living Nursing Home (private room) In-Home Care (44 hours/week) Source: Genworth 2011 Cost of Care Survey, conducted by CareScout ®, April 2011. Based on national median costs. * Estimates how much care might cost based on 5% annual inflation.

9. Myths and Reality Myth: “It won’t happen to me.” Myth: “My insurance already covers this.” Myth: “The government will pay.” Myth: “I can pay for it out of my savings.”

10. 2 Benefits for Employer and Employee

11. Benefits for Employer Can Provide a Tax-Advantaged Benefit for Themselves Attract, Reward and Retain Quality Employees Reduce Employee Time Off for Extended Care Issues when Spouse and Family Coverage is Offered Reduce Loss of Employee Productivity

12. Benefits for Employee Help Protect Retirement Income Stream and Lifestyle Certificate Portability Extended Family Coverage when Available

13. 3 Deductibility of Premiums

14. LTCI as an Executive Benefit: The Abilities Select-ability Spouse-ability Deduct-ability Port-ability Discount-ability You should always consult with your legal and tax advisors regarding the tax consequences of paying long term care insurance premiums through a business.

15. C-Corporation Deductibility Employer deducts premiums for tax-qualified LTCI policies on employees, spouses and legal dependents Premiums paid by employer are not included in employee’s taxable income Policy benefits not included in recipient’s taxable income Owners actively at work in the corporation are generally considered stockholder-employees Select class of employees defined by employment, not ownership “Ten Pay” opportunities

16. 2012 Deduction For LTCI Premiums Attained Age Before Close of 2012 Premium Limit Taxable Amount • 40 or younger • 41 through 50 • 51 through 60 • 61 through 70 • 71 and older • ..…………...…….. • …..……...……….. • ……………….... • …..…………….. • …….…………….. • $350 • $660 • $1,310 • $3,500 • $4,370 Maximum medical expense claim for qualified long term care insurance premiums under IRC Section 213(d)(10)

17. S-Corporation Deductibility Premiums attributed to each greater than 2% shareholder-employee included in their income Greater than 2% shareholder-employee deducts lesser of actual premiums paid or eligible long term care premium Policy benefits not included in recipient’s taxable income Select class of employees defined by employment, not ownership

18. Partnership Deductibility Partnership pays premiums for LTCI policies covering active partners and spouses Premiums attributed to each partner included in their income Partner deducts the eligible premium (lesser of combined actual premiums or age-based limits) Benefits are not included in recipient’s taxable income

19. Limited Liability Company (LLC) Deductibility – If LLC Elects Partnership Tax Treatment LLC owners are called “members” LLC pays premiums for LTCI policies covering active members and spouses Premiums attributed to each member included in their income Member deducts the eligible premium (lesser of combined actual premiums or age-based limits) Benefits are not included in recipient’s taxable income

20. 4 Long Term Care Insurance and How It Works

21. What is Long Term Care? Due to accident, illness or severe cognitive impairment Care to provide for yourself (activities of daily living) Expected to last 90+ days

22. Benefit Eligibility Triggers to Qualify for Covered Benefits: Help Is Needed With at Least 2 of the 6 Activities of Daily Living and Expected to be Needed for at Least 90 Days • Bathing • Dressing • Continence • Toileting • Transferring • Eating • OR • Severe Cognitive Impairment (e.g., Alzheimer’s disease)

23. How Does Long Term Care Insurance Work? It provides a “Pool of Benefit Dollars” for long term care when and where needed. Benefit Dollars Home Care Assisted Living Care Nursing Facility Care Care Coordination Services* *Does not count against coverage maximum

24. Designing Coverage Monthly Maximum Benefit Multiplier Elimination Period Inflation Protection Example Monthly Maximum $4,500 Benefit Multiplier x 60 Coverage Maximum $270,000 $270,000 “Pool of Benefit Dollars”

25. Employer Paid Funding 100% Employer-Paid for Employee. Employer-Paid for Spouse. Minimum Participation Minimum 7 Submitted & Issued Employer-Paid Employee Lives Underwriting Employees: W2 Employees and Spouses Age 18 and Older, Actively at Work 30+ Hours, During Initial Enrollment Executive Series • Maximum Benefit Limits: $9,000 perMonth & 5-Year Benefit Period • Short Form, Simplified Underwriting • All Others: • Long Application, Full Underwriting • Applicable Discounts • No Preferred Health Discount • Partner / Spousal Discounts Applicable (40% 2 apply/2 issued, 25% 2 apply/1 issued) • 5% Multi-Life Discount (taken after other discounts are applied)

26. LTC Business Solutions Program Simplified Underwriting – Three Questions 1 2 3 • INSURABILITY PROFILE • 3 QUESTIONS: • ADL • Specified Conditions • Height / Weight

27. Employee Paid Funding 100% Employee-Paid Minimum Participation Minimum 7 Submitted & IssuedEmployee Lives Underwriting Employees: W2 Employees Age 18 and Older, Actively at Work 30+ Hours, During Initial Enrollment Long Application, Full Underwriting Employee Advantage • Preferred Health Discount Applicable with “No” Tobacco Usage • All Others: • Long Application, Full Underwriting • Applicable Discounts • Preferred Health Discount (20% for singles, 10% for couples) • Partner / Spousal Discounts Applicable (40% 2 apply/2 issued, 25% 2 apply/1 issued) • 5% Multi-Life Discount (taken after other discounts are applied)

28. Employer and Employee Paid Funding Employer and Employee-Paid Minimum Participation Minimum 7 Submitted & Issued Employer-Paid Employee Lives Underwriting Employer Paid Employees and Spouse/Partner: W2 Employees Age 18 and Older, Actively at Work 30+ Hours, During Initial Enrollment Maximum Benefit Limits: $9,000 Month & 5-Year Benefit Period Short Form, Simplified Underwriting Employee Plus • Buy Up Paid by Employee: • Long Application, Full Underwriting • All Others: • Long Application, Full Underwriting • Applicable Discounts • Preferred Health Discount (20% for singles, 10% for couples) on buy up portion or total voluntary portion • Partner / Spousal Discounts Applicable (40% 2 apply/2 issued, 25% 2 apply/1 issued) • 5% Multi-Life Discount (taken after other discounts are applied)

29. Benefit Options Shared Coverage with Joint Waiver Rider Home Care: 50%, 75% & 100% Service or Calendar Day Elimination Period 0 Day Home Care Elimination Period Inflation Protection*: 3% & 5% Compound, 5% Equal, Future Purchase Option Nonforfeiture Benefit Restoration of Benefits *Inflation Protection benefits affect the availability of state long term care partnership asset protection. Check state availability for specific partnership programs.

30. 5 About Genworth

31. About Genworth Genworth Financial Overview A Leading Financial Security Company in the U.S., with an International Presence Serving More than 15 Million Customers More than $100 Billion in Assets Global Operations in 25 Countries CareScout® Programs & Services • Genworth’s LTC Business* • #1 Provider of LTCI • Nearly 1 in 5 LTCI Insureds Have Genworth Life Coverage • Nearly $2.0 Billion Premium in Force • 37 Years of Experience • Genworth’s LTC Operations** • Over 1 Million Policyholders • Over $7.7 Billion in Claims Paid • Multiple Long Term Care Solutions *LIMRA Individual Long Term Care Insurance 2010 Sales and In Force **Genworth Business Operations Data 12/1974-12/31/11

32. 6 Next Steps

33. Next Steps Determine Type of Program to be Considered Complete Employer Paperwork Review Implementation Strategies and Determine Timelines Offer Long Term Care Insurance as a Benefit

34. Content referring to Long Term Care Business Solutions provides information on Group Long Term Care Insurance available from Genworth Life Insurance Company. It is not a contract for insurance. Coverage under the Group Policy is intended to be qualified long term care insurance under federal tax law (IRC 7720B). As the Group Policyholder, the employer will receive a Group Policy (the contract of insurance) that sets forth the terms and conditions of coverage, eligible classes, and the premiums associated with the Group Program available to those persons eligible for coverage. Coverage is subject to the underwriting requirements of Genworth Life Insurance Company. Each eligible person who becomes insured will receive a Certificate of Insurance. The Group Program is provided under policy form series 7050 and governed by the state in which the Group Policy is issued. State variations apply for those states that have extra-territorial authority. All coverage maximums include combined coverage from all other carriers.

35. The tax information in this material was written to support the promotion and marketing of the contract. The Genworth Financial companies and their representatives and distributors do not provide tax or legal advice.  We did not write this material for use by any taxpayer to avoid any Internal Revenue Service penalty. Clients should ask their independent tax and legal advisors for advice based on their particular situation. Long Term Care Insurance products are underwritten by Genworth Life Insurance Company and, in New York, by Genworth Life Insurance Company of New York. Administrative office: Richmond, Virginia.