Global Insurance Solutions Inc. March 29, 2006

1. Global Insurance Solutions Inc.March 29, 2006

2. Paul Freedman MBA, CFP paul.freedman@axa-insurance.ca 416-721-4931(cell)

3. Stir the Pot - Cook Up New Sales

4. Agenda • Using Total Needs Analyses Software • Uncover Needs • Prepare for Compliance • Stir the Money Pot – Three Selling Ideas • CI to Protect RRSPs • Quick Pay Mortgage and UL • Guaranteed Pay – Alternative to RRSP • AXA Marketing Initiatives - 2006

5. Why use a needs analysis tool? • Uncover additional needs • Professionalism • Compliance trends • Quebec • Agent disclosure • Conflict disclosure • Increases compensation

6. Common problems with needs analysis tools • Overly complex • Time consuming • Stand alone tool not integrated into quote system • Multiple pages • Changes cost money – print, print, print

7. AXA Needs Analysis • Built into the AXA software • Accurate • Comprehensive • Easy to use • One page snapshot of assets and liabilities • Professional appearance • Launch pad for AXA life quotes

8. Needs Analysis – Discovery • First meeting objective: Determine the amount of coverage required • Assets and liabilities • Existing insurance coverage • Goals and objectives • Don’t forget the “Soft’ questions – feeling &finding

9. Needs Analysis - The report • One page snap shot • Net worth statement • Defines the need

10. Stirring the Pot…. • Total Needs Analyses highlights weaknesses in planning • Clients often accept need for insurance – just do not want to pay for it (or feel they can not afford it) • Needs Analyses highlights spending patterns • Stir the Pot – take existing monies and re-allocate to achieve same goals while providing additional flexibility

11. Critical Illness Insurance & RRSPs If a critical illness strikes…… • RRSPs designed for retirement use but often client’s only savings • Fully taxable upon withdrawal – not efficient use of savings • Long term financial plans based on compounding of growth i.e. time money is invested • Restoring savings likely to be difficult

12. Critical Illness Insurance & RRSPs Solution: Contribute less to RRSP and purchase CI with ROP benefit • Ensures that RRSP remains intact in event of Critical Illness • More funds available to effectively deal with critical Illness • “Redirecting” savings will have minimal effect on retirement income

13. Critical Illness Insurance & RRSPs Facts • Husband and wife, aged 40 and 38 • Family income of $75,000 annually • Husband works full-time; wife part-time • 2 children, own home • RRSP total savings currently of $20,000 and plan to contribute $3,000 per year to retire at 65

14. Critical Illness Insurance & RRSPs Alternate Strategy “Re-direct money” into CI to protect savings and provide funds in the event of a critical illness • Buy $25,000 CI with ROP on husband • Cost - $476 annually* * AXA T-75 Enhanced CI plan with FROP

15. Critical Illness Insurance & RRSPs • Continue as is: • By age 69, RRSPs grow to $341,127* • Redirect monies to CI policy: • RRSP grows to $302,210* • ROP of $14,295 • Total savings = $316,505 • In first year of RRIF, $24,622 difference represents approx. $100 per month, before taxes * 6% annual compounded growth

16. Critical Illness Insurance & RRSPs • If illness strikes and RRSP savings used, RRSP only grows to $226,256 at age 70 • Monthly income difference in excess of $358 per month • CI monthly payment results in minimal income drop yet ensures retirement income plan stays in place • If death occurs, CI premiums refunded

17. Critical Illness Insurance & RRSPs • Use proposed RRSP $$$ to buy CI • Client does not have to look for “new” money • Keeps retirement plans in place • Provides more money if critical illness occurs (CI proceeds not taxable) AND reduces stress about future • Minimal affect on retirement income • Have insured client at “no cost”

18. Quick Pay Mortgage and Universal Life General wisdom is to pay home off quickly…. • Accelerated weekly payments reduces cash flow • Families often do without financial necessities • Disability income replacement • Emergency funds • Permanent life insurance

19. Quick Pay Mortgage and Universal Life Solution: Make monthly mortgage payments and purchase Universal Life Insurance • Cash build up inside plan provides income in case of need • Mortgage can still be retired at desired date • Financial flexibility if circumstances change (for better or worse) • Increased life insurance protection, including paid up permanent protection

20. Quick Pay Mortgage and Universal Life Facts • Husband age 42; wife age 40 • Jointly owned mortgage of $250,000 • Pay $416 per week* ($1,805 per month) • Bank mortgage insurance costs $105 per month • May inherit from parents in 20 – 30 years • No savings other than RRSPs * 6.45% 5 yr. term; 25 yr ammort.;

21. Quick Pay Mortgage and Universal Life Alternate Strategy • Purchase $25,000 Universal Life Insurance on wife • Add T-20 riders: $250,000 on him; $225,000 on her • Pay mortgage monthly - $1,667 per month • Fund UL with difference in mortgage and insurance costs • Pay off mortgage fully in 20 years, if desired

22. Quick Pay Mortgage and Universal Life Continue as is…. • Mortgage will be paid in full in 21 years (4 years earlier than if paid monthly) • No permanent life insurance • Declining life insurance coverage; no ability to convert; not transportable • No emergency fund • Only savings in RRSP

23. Quick Pay Mortgage and Universal Life • Re-allocate $244 per month (difference in weekly/monthly mtge. costs) to UL* • Flexibility now to withdraw cash in event of disability, job loss, education needs or other unforeseen needs • Enhanced life insurance protection: • Term riders with level, convertible coverage • Permanent coverage *40 FNS,Pact II, T-100, 6%ROI

24. Quick Pay Mortgage and Universal Life • Accelerated payments - mortgage retired at end of year 21 • Monthly mortgage schedule - $70,546 owing at end of year 21 • UL Fund Value – est. $71,572 at end of year 21 • Taxes on Fund – approx. $14,000, if owner still working

25. Quick Pay Mortgage and Universal Life • Mortgage retired on schedule, no increase in monthly family expenses • Couple has minimum of $500,000 of life protection throughout period, all of which can be made permanent if desired • Cash available for emergencies from year 1 • Estate planning already in place if circumstances change (Inheritance? New job?) • Works well increasing rate environment

26. Limited Pay Insurance and RRSPs RRSPs great …. • Tax-Deferred Growth • Annual Tax Reductions But can be too much of a good thing.… • Access to money limited – no flexibility • $$$ taken into income – could affect OAS; income tax rate • Taxes have to be paid - at death, estate reduced significantly

27. Limited Pay Insurance and RRSPs Solution: Reduce or stop RRSP contributions and purchase high cash value, limited pay guaranteed life insurance • Retirement income unaffected • Enhanced flexibility in using retirement income • Estate planning solidified

28. Limited Pay Insurance and RRSPs Facts • 50 yr. old female – current RRSP valued at $250,000 • Contributes $10,000 annually into her RRSP • RRSP to be primary source of retirement income • Would like to leave a legacy

29. Limited Pay Insurance and RRSPs Alternate Strategy Use “usual” RRSP contributions to purchase limited pay life insurance with guaranteed cash values • Stop future contributions to RRSP • Leave existing RRSPs to compound • Purchase $300,000 limited pay Horizon 65 at $6,700 per year

30. Limited Pay Insurance and RRSPs • Continue as is: • Base RRSP grows to $801,784* @ age 70 • New contributions add additional $238,998 @ age 65* • Purchase $300,000 Horizon 65 using equivalent of net proceeds of RRSP contributions ($6,700/yr.) • Guaranteed CSV @ age 65 = $150,000 6% return compounded annually

31. Limited Pay Insurance and RRSPs • Access to cash in policy flexible: • Borrow – proceeds tax-free; capitalize costs • Leverage – structure deal with lender; proceeds tax-free • Withdraw – net approx. $137,471* - insurance lapses • Only last option affects income *Assume 30% tax rate, based on ACB

32. Limited Pay Insurance and RRSPs • Access to RRSP monies limited • Monies can only be brought into income at marginal rate • Contributions for 15 years = $238,998 • Taken as lump sum at age 65, proceeds would net approx. $131,449* • Loss of OAS *Assume 45% tax rate

33. Limited Pay Insurance and RRSPs • At some point, RRSP represents major tax liability • Guaranteed pay insurance provides flexibility in planning; no loss in retirement income • OAS will not be affected • Bonus - $300,000 of Life Insurance fully paid at age 65 • EDB to age 60

34. Summary • Comprehensive, written Needs Analysis provides Professional assessment of client’s position using THEIR numbers • Highlights total current financial situation • Exposes both short term and long term needs

35. Summary • Insurance products enable client to: • Achieve financial and life-style goals • Provide greater security • Introduce flexibility into family budget • All the above, at no additional “cost” to the client Win – Win

36. 2006 Sales and Marketing Initiatives

37. Sales and MarketingBusiness Building Program - 2006 AXA LAUNCHES IT’S BUSINESS BUILDING PROGRAM FOR BROKERS TO HELP YOU BUILD A MORE PROFITABLE BUSINESS IN 2006 AND BEYOND

38. Sales and MarketingBusiness Building Program - 2006 • BEST Program - Life • BEST Program - Living Benefits • Activity Incentives • Productivity Rewards • Conference 2007 • Achieve your goals!!!

39. Sales and MarketingBroker Education Sales Training - LIFE • 8 week classroom program; No cost to broker • Sales development - Prospecting, referrals, seminars • Total needs selling - Fact finding, Probing; Wills/PA’s • Closing the sale - Positioning, objections, role playing • Selling concepts – Needs, not products • Product discussions - Whole life, Term, UL • Case study - Family, business, single need • Contact your MGA more information about BEST

40. Sales and MarketingBroker Education Sales Training-LIVING BENEFITS • Industry leading faculty (Munich Re, Dr.’s, consultants etc.) • 3 day, 2 night seminar program • The living benefits market and uncovering needs • The role of Wills and Living PA’s • Placing your case: Underwriting living benefits • Product discussions - guaranteed vs non guaranteed premiums • Sales concepts - keyperson, buy/sell, family, single need • By invitation; must have sold an AXA living benefit product

41. Sales and MarketingActivity Program • Incentives for Submitting UL, Term, CI, LifeBeat, A&S and Mortgage applications • $100 upon submitting first 3 applications • $50 for EVERY application there after • Program starts Feb 15th and closes June 30th, 2006 • Rewards paid at the end of April and end of June; money will be directly deposited to your bank account SUBMITTED APPLICATIONS

42. Sales and MarketingProductivity Program In addition to usual FYC and bonus: • Additional Reward based on net FYC • $5,000 - $500 • $10,000 - $1,000 • $15,000 - $1,500 • $20,000 and over - $2,000 • $25,000 – conference qualifier and $2,000 • Paid in January 2007, deposited directly to your bank account

43. Sales and Marketing2007 Sales Conference • $25,000 Net First Year Commissions • 10 Applications • Past conference locations • Mexico-March 2006 • North Africa-2005 • Dominican Republic-2004 • Cuba-2003 • Settled business from January 1st, 2006 until December 8th, 2006

44. Sales and MarketingTo Help You Achieve Your Goals • 50% FYC plus bonus on T-10, T-20 and T-70 • Extreme Disability Benefit at no additional cost • T-10 Indexed: option to double face amount included at no Extra cost! • CI $100,000 offer included with issued Preferred T-10 • New Investment Options on UL • 55% FYC on LifeBeat

45. Paul Freedman MBA, CFP paul.freedman@axa-insurance.ca 416-721-4931(cell) Thank You