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Allianz Life Insurance Training GENDEX MOMENTUM . Allianz Life Insurance Company of North America. For agent use only – not for use with the public. Allianz LIFE Products.

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slide1

Allianz Life Insurance TrainingGENDEX MOMENTUM

Allianz Life Insurance Company of North America

For agent use only – not for use with the public

slide2

Allianz LIFE Products

Term 10 – 20 - 30 year (ROP)Generation Planner – Low cost UL Legacy Planner – Simplified Underwriting GenDex Momentum – Cash Value GenDex Survivor – Second to Die

slide3

Allianz LIFE Products

Term 10 – 20 - 30 year (ROP)Generation Planner – Low cost UL Legacy Planner – Simplified Underwriting GenDex Momentum – Cash Value GenDex Survivor – Second to Die

agenda
Agenda
  • GenDex MomentumSM Life Insurance Policy
        • Crediting Methods
        • Policy specs
        • Six case studies
        • Software
what makes fiul different
What makes FIUL different?
  • Other “moving parts”:
      • Participation rate
        • 10% index increase x 100% participation = 10% return
        • 10% index increase x 50% participation = 5% return
        • 10% index increase x 230% participation = 23% return
      • Cap
        • 10% index increase with an 8% cap = 8% return
        • 10% index increase with a 14% cap = 10% return
      • Fees
        • 10% index increase with a 3% fee = 7% return
what makes fiul different1
What makes FIUL different?
  • Three words: Indexed interest potential

Cash value earns interest based on external index(es).

NASDAQ 100

S&P 500

EUROSTOXX 50

Fixed Interest 5.25%

Blended Index

Universal Life Policy

what makes fiul different2
What makes FIUL different?
  • Three words: Indexed interest potential.
      • Positive index return is credited to policy1
      • Gains are locked in each year
      • Negative index return equals 0% return on policy.
what makes fiul different3
What makes FIUL different?
  • Crediting interest
      • 4 Crediting Methods
          • Annual point-to-point

No single crediting method is best in all situations

what makes fiul different4
What makes FIUL different?

Annual point-to-point

1110

1100

1083

1090

1080

1070

1060

1050

1040

1030

1000

1020

1010

1000

990

980

970

960

950

940

930

End Year 1

The hypothetical example is used to illustrate the crediting method only. It does not represent any specific product or past performance. Actual performance will vary. This is not a guarantee of future results.

what makes fiul different5
What makes FIUL different?
  • Crediting interest
      • 4 Crediting Methods
          • Annual point-to-point
          • Monthly sum
          • Monthly average
          • Fixed interest

No single crediting method is best in all situations

what makes fiul different6
What makes FIUL different?

Monthly point-to-point

1110

1100

1090

1080

1070

1060

1050

1040

1030

1020

1010

1000

990

980

970

960

950

940

930

End Year 1

The hypothetical example is used to illustrate the crediting method only. It does not represent any specific product or past performance. Actual performance will vary. This is not a guarantee of future results.

what makes fiul different7

1

5.27

+3.40

2

-2.00

-2.00

3

2.00

+2.00

4

-1.50

-1.50

5

4.61

+3.40

6

2.50

+2.50

7

3.87

+3.40

8

0.25

+0.25

9

-3.00

-3.00

10

-4.00

-4.00

11

4.43

+3.40

12

(The sum of capped monthly changesequals the year’s indexed interest.)

2.25

+10.10%

+2.25

What makes FIUL different?

Monthly sum

Assumed cap is 3.40%

Month

Hypotheticalmonthly index change

Cappedmonthly change

The hypothetical example is used to illustrate the crediting method only. It does not represent any specific product or past performance. Actual performance will vary. This is not a guarantee of future results.

what makes fiul different8
What makes FIUL different?
  • Crediting interest
      • 4 Crediting Methods
          • Annual point-to-point
          • Monthly sum
          • Monthly average
          • Fixed interest

No single crediting method is best in all situations

what makes fiul different9
What makes FIUL different?

1000

1020

Monthly Average

1045

1110

1081

1100

1025

1090

1060

1015

1080

1045

1070

1055

985

1025

1060

1020

1050

1023

997

1040

1050

1030

1015

1023

1000

1020

1027

1027

1010

997

1000

990

1055

980

985

970

1050

960

950

1060

940

930

1081

End Year 1

The hypothetical example is used to illustrate the crediting method only. It does not represent any specific product or past performance. Actual performance will vary. This is not a guarantee of future results.

what makes fiul different10
What makes FIUL different?

Monthly average

Hypothetical example used to illustrate crediting method only. Does not represent any specific product or past performance. Actual performance will vary. Not a guarantee of future results.

what makes fiul different11
What makes FIUL different?
  • Crediting interest
      • 4 Crediting Methods
          • Annual point-to-point
          • Monthly sum
          • Monthly average
          • Fixed interest

No single crediting method is best in all situations

allianz gendex momentum sm life insurance policy
Allianz GenDex MomentumSM Life Insurance Policy
  • Blended index
      • Dow Jones Industrials (35%), Lehman Aggregate Bond (35%), Euro STOXX 50 (20%), Russell 2000 (10%)

The Dow Jones EURO STOXX 50 Index's stated objective is to provide a blue-chip representation of leading corporations in the Eurozone. The index covers 50 stocks from 12 Eurozone countries: Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain.

The Dow Jones Euro STOXX 50® is the intellectual property (including registered trademarks) of Stoxx Limited, Zurich, Switzerland and/or Dow Jones & Company, Inc., a Delaware corporation, New York, USA, (the "Licensors"), which is used under license. The financial instruments based on the Index are in no way sponsored, endorsed, sold or promoted by the Licensors and neither of the Licensors shall have any liability with respect thereto.

The Dow Jones Industrial Average is a popular indicator of the stock market based on the average closing prices of 30 active U.S. stocks representative of the overall economy.

Lehman Brothers Aggregate Bond Index is a market value-weighted index of investment-grade fixed-rate debt issues, including government, corporate, asset-backed and mortgage securities, with maturities of one year or more.

Russell 2000® Index is an equity index representing 2,000 of the smallest companies within the larger Russell 3000® Index. Often looked at as one benchmark for small stock investors. Russell 2000 is a registered service mark of Frank Russell Company.

protection with potential monthly average crediting with allocation to blended index
Protection with potential: monthly average crediting with allocation to blended index

The chart below illustrates the performance of GenDex Momentum over the past 20 years using monthly average crediting of the blended index. The columns indicate the year sampled, actual historical index performance for that year, and corresponding GenDex Momentum annualized monthly average credits based on an assumed 175% participation rate, 0% floor, and a 10-year death benefit guarantee. Also illustrated are the credits using the 25% minimum guaranteed participation rate.

This example is provided for illustrative purposes only. Past performance is not an indication of future results.

Based on actual blended index returns. Assumes GenDex Momentum was available in 1988.

allianz gendex momentum sm life insurance policy1
Allianz GenDex MomentumSM Life Insurance Policy
  • Added flexibility
      • Can reallocate on every contract anniversary
      • Allocations can be made in 1% increments
slide21
GenDex Momentum provides:
      • A death benefit to the beneficiaries
      • NEW! Index choices (230% par. rate on monthly average!)
      • Higher caps and illustrated rates
      • Higher target premium (25%-30%)
      • Shorter surrender periods
      • Enhanced Early Liquidity
slide22
The GenDex Series can help provide solutions for:
      • #1 - Supplemental Retirement Income
      • #2 - Family Planning Strategies
      • #3 - Universal Life Insurance Policy Rescue Strategy
      • #4 - College Funding
      • #5 - Wealth Transfer (single premium)
      • #6 - Business Planning Strategies- Executive Bonus Plan
      • #7 - Charitable Giving
      • #8 - Business Succession Planning Strategies - Buy/Sell
slide23

Allianz GenDex MomentumSM Life Insurance Policy

  • Case Study #1: Supplemental Retirement Income
      • Jim and Lori, both are healthy and 45 years old
      • Two children
      • Jim recently got a promotion at work
      • Their total annual income is now $180,000
      • Jim & Lori each used to contribute $4,000/yr to Roth IRAs
      • They just recently purchased a new home with a $300,000 mortgage
  • This hypothetical example is provided for illustrative purposes only. Characters are fictional and are not actual Allianz clients.
slide24

Allianz GenDex MomentumSM Life Insurance Policy

  • Here is an example of how GenDex Momentum could be a good fit for Supplemental Retirement Income
  • Assumptions:
      • 45 year old male Preferred Plus Non-Tobacco Risk Class
      • Face amount = $300,000
      • Over fund the policy with $8,000 of annual premium
        • Target annual premium $5,023.50
        • Max non-MEC premium is $14,230.58
      • Pay to age 65 and then take retirement income 66-85
  • This hypothetical example is provided for illustrative purposes only. Characters are fictional and are not actual Allianz clients.
allianz gendex momentum sm life insurance policy2
Allianz GenDex MomentumSM Life Insurance Policy
  • Case Study #2: Family Planning Strategies
      • Dave and Katie are both healthy and 35 years old
      • They have one child with another on the way
      • Katie is a stay at home mom
      • Dave’s annual income is $110,000
      • Dave and Katie currently own a home with about $150,000 left on their mortgage
  • This hypothetical example is provided for illustrative purposes only. Characters are fictional and are not actual Allianz clients.
slide26

Allianz GenDex MomentumSM Life Insurance Policy

  • Here’s an example of how GenDex Momentum could be a good fit for Family Planning Strategies
  • Assumptions:
      • 35 year old male Super Preferred Non-Tobacco Risk Class
      • Face amount=$250,000
      • Add Additional Term Rider1 of $250,000 for 30 years to give Dave extra death benefit at a more reasonable cost than with traditional cash value insurance
      • Add Child Term Rider1 ($10,000) to cover children
      • Add Other Insured Term Rider1 for $250,000 to provide life insurance coverage for Katie (Super Preferred Non-Tobacco)

1 Riders are available at an additional cost.

  • This hypothetical example is provided for illustrative purposes only. Characters are fictional and are not actual Allianz clients.
slide27

Allianz GenDex MomentumSM Life Insurance Policy

  • Case Study #3: Universal Life Insurance Policy Rescue Strategy
      • Edward is 50 years old in good health
      • He purchased $200,000 current interest UL policy 15 years ago from ABC Insurance Company - paying $200/month.
      • Originally interest rate = 10%
      • Current interest rate = 4%
      • Cash surrender value = $25,000
      • If Edward continues to pay $200/month, his policy will lapse at age 70 based on the current 4% interest.
      • Edward’s goal is to have a policy build cash value and run to age 100.
  • This hypothetical example is provided for illustrative purposes only. Characters are fictional and are not actual Allianz clients.
slide28

Allianz GenDex MomentumSM Life Insurance Policy

  • Here’s an example of how GenDex Momentum would be a good fit for a Universal Life Insurance Policy Rescue Strategy
  • Assumptions:
      • 50 year old male Preferred Plus Non-Tobacco
      • Face amount of $200,000
      • 1035 exchange of $25,000 into GenDex Momentum
      • Continue to pay $200/month
      • GenDex Momentum will help accomplish Edward’s goals by utilizing an FIUL policy with potential cash value accumulation

This hypothetical example is provided for illustrative purposes only. Characters are fictional and are not actual Allianz clients.

slide29

Allianz GenDex MomentumSM Life Insurance Policy

  • Case Study #4: College Funding
      • Patty is a single mother 30 years old, very healthy.
      • Has a 2 year old daughter named Emma.
      • Patty would like to provide college funding for Emma when Emma turns age 18.
      • Her budget allows her to contribute $5,000/year for life insurance coverage and college savings.
      • Patty anticipates Emma will be in college for 5 years
  • This hypothetical example is provided for illustrative purposes only. Characters are fictional and are not actual Allianz clients.
slide30

Allianz GenDex MomentumSM Life Insurance Policy

  • Case Study #5: Wealth Transfer
      • Arthur is 60 years old and in average health.
      • He has $500,000 that he would like to pass on to his beneficiaries.
      • It is important that the $500,000 continues to accumulate before he passes it on.
      • Arthur would like to be able to access that $500,000 in case he needs extra cash for emergencies, LTC, retirement, etc.
  • This hypothetical example is provided for illustrative purposes only. Characters are fictional and are not actual Allianz clients.
slide31

Allianz GenDex MomentumSM Life Insurance Policy

  • Here’s an example of how GenDex Momentum could be a good fit for Wealth Transfer
  • Assumptions:
      • 60 year old male Standard Nontobacco
      • Single pay premium of $500,000 (MEC)
      • Minimize death benefit to potentially increase accumulation potential
      • Initial death benefit = $1,055,000 (minimum face)
      • The LTC Rider can be added at an additional cost
  • This hypothetical example is provided for illustrative purposes only. Characters are fictional and are not actual Allianz clients.
slide32

Allianz GenDex MomentumSM Life Insurance Policy

  • Here’s an example of how GenDex Momentum could be a good fit for College Funding
  • Assumptions:
      • 30 year old female Preferred Plus Non-Tobacco Risk Class
      • Face amount=$250,000
      • Pay $5,000 for 15 yrs (until Emma turns 18)
      • Take income from yrs 16-20 (for five years of college)
  • This hypothetical example is provided for illustrative purposes only. Characters are fictional and are not actual Allianz clients.
slide33

Allianz GenDex MomentumSM Life Insurance Policy

  • Case Study #6: Business Planning Strategies
      • XYZ Company uses Executive Bonus (Section 162) Plans to attract, motivate, and retain key employees
      • Roger, a 45 year old key executive of XYZ Company, has elected to participate in the Executive Bonus Plan.
      • When XYZ hits their goals each year, they agreed to contribute $100,000 into Roger’s plan.
      • Roger needs life insurance to protect his family and to help him save for retirement.
  • This hypothetical example is provided for illustrative purposes only. Characters are fictional and are not actual Allianz clients.
slide34

Allianz GenDex MomentumSM Life Insurance Policy

  • Here’s an example of how GenDex Momentum would be a good fit for Executive Bonus (section 162) Business Planning
  • Assumptions:
      • 45 year old male Preferred Plus Nontobacco
      • XYZ Company plans to pay $100,000/year to Roger’s age 65
      • Roger will take retirement income from ages 66-85
      • Roger needs $6,000,000 in life insurance
  • This hypothetical example is provided for illustrative purposes only. Characters are fictional and are not actual Allianz clients.
slide35

Thank you for your time.

Allianz Life Insurance Company of North America

For agent use only – not for use with the public