Insurance made Simple, Fast & Easy

1. z Insurance made Simple, Fast & Easy Sept 2016 Advisor Use Only

2. Agenda • Policy Holder Taxation Update • Introducing Empire Life CI Protect • Case Study

3. Policy Holder TaxationCommunication Plan Announce to top producers the cessation of Trilogy, Optimax & Vital Link sales October 14, 2016. July Announce to all advisors/public the cessation of Trilogy, Optimax & Vital Link sales October 14, 2016. August Announce NEW Term, PAR & CI plans coming October. Announcement of transition rules for Oct 14, 2016. August Oct 14, 2016 deadline for old product applications. Launch of NEW Term, PAR & CI plans using G2(current) tax rules. October Reminder of deadline for in-the-mill business to qualify for G2 (current) tax rules on November 30, 2016. November Transition to G3 illustrations for all products December 3

4. 2016 Product Line-Up Changes July 2016 October 15, 2016 Solution 10 Solution 20 Solution 100 Trilogy EstateMax (20 & Life Pay) Optimax (20 & Life Pay) CI Protect Vital Link Simplified 10 Simplified 20 Solution 10 Solution 20 Solution 100 Solution ART EstateMax (20 & Life Pay) Optimax Wealth (20 & Life Pay) CI Protect CI Protect Plus (November) Simplified 10 Simplified 20 4

5. Trilogy Why Sell before October 14, 2016? • Only Universal Life product on the market with T10 and T20 COI options • No surrender fees, guaranteed 1.75% account • Guaranteed option to switch between all 5 COI options, no change to tax status when cost change made • Full commission paid on switch between COI option 5

6. Sales Illustration Software Releases Novinsoft Release with New Products (G2)* Illustrate Inc. discontinued October November 30, 2016 – Novinsoft G3 Release November * New Sales Concept Tool added to Novinsoft release 6

7. New Sales Concepts added to Illustration Software Sales Concepts For PAR 1) Annuity Estate Maximizer 2) Asset Value Preserver 3) Capital Dividend Account 4) Capital Gains Protector 5) Charitable Insurance 6) Corporate Insured Retirement 7) Corporate Redemption Of Shares 8) Corporate Split Dollar 9) Employee Shareholder 10) Family Split Dollar 11) Guaranteed Insured Inheritance 12) Income Shelter 13) Insured Annuity Ledger 14) Insured Retirement 15) Internal Rate of Return 16) Key Person 17) RRIF Estate Maximizer 18) Education funding with Par Ins 19) Pension Maximization 20) Annuity Funded Life Insurance 7

8. QUESTIONS? 8

9. z Empire Life CI Protect Critical Illness made Simple, Fast & Easy Sept 2016 Advisor Use Only

10. Critical Illness Insurance Sales Source: Canadian Individual Critical Illness Sales Report Q1 2016, LIMRA

11. Critical Illness Insurance Sales • Q1 2016 Sales by Product Type Most popular Source: Canadian Individual Critical Illness Sales Report Q1 2016, LIMRA

12. Critical Illness Insurance Sales • Q1 2016 Sales by Product Type Most popular Source: Canadian Individual Critical Illness Sales Report Q1 2016, LIMRA

13. Critical Illness VS Life Insurance • Despite the faster growth rate in policy count, individual CI sales are still relatively small in comparison to individual life sales Source: Canadian Individual Critical Illness Sales Report 2015, LIMRA

14. Critical Illness Insurance Needs • Considering: 9 in 10 Canadians have at least one risk factor for heart disease or stroke2 About 2 in 5 Canadians will develop cancer in their lifetime1 Over 19,000 Canadians ages 18 or older had coronary bypass surgeries performed.4 62,000 strokes occur in Canada each year – that is one stroke every nine minutes.3 1 Canadian Cancer Statistics 2015, Canadian Cancer Society. 2 2015 report on the health of Canadians, Canadian Heart and Stroke Foundation. 3 Stroke Report 2015, Canadian Heart and Stroke Foundation. 4 Based on 2013 Coronary Artery Bypass Graft (CABG) rate for both sexes, age-standardized rate per 1,000 of population, Canadian Institute for Health.

15. Why Critical Illness Insurance Sales Still Low? • Factors that contribute to lower CI sales: • Placing critical illness insurance is harder and takes longer than life insurance Critical illness insurance is too expensive • Couldn’t find the right opportunity to start the conversation

16. Introducing Empire Life CI Protect • Critical illness insurance made • Simple; • Fast; and • Easy

17. Critical Illness Insurance Made Simple, Fast & Easy • Simple product features • Covers 4 major illnesses; no “bells and whistles” to keep cost low

18. Critical Illness Insurance Made Simple, Fast & Easy • FAST application process • Available: • Fast & Full life application; or • Paper (complete D-0082 & D-0082C)

19. Critical Illness Insurance Made Simple, Fast & Easy • Easy to apply • Use Life insurance questions • One knock-out health question • No additional CI requirements

20. CI Protect – Product Details • Covers 4 major critical illnesses: cancer, heart attack, stroke and coronary bypass surgery • Account for 88%of paid CI claims Source: Munich Re 2014 Individual Insurance Survey

21. CI Protect – Product Details • 10-year renewable term with guaranteed initial and renewal premiums • 18 – 65 (age nearest) • $25,000 to $75,000 • Coverage expires at age 75 • Single life coverage • As base coverage; or • As rider to Solution Series and EstateMax Target middle income families - Canadians who are ages 25 to 50

22. CI Protect – Product Details • Standard risk classes – non-smoker or smoker • Non-convertible • Annual policy fee: $50 ($0 as a rider) • No optional riders/benefits • Built-in lump sum death benefit of $1,000 payable if life insured dies from any cause before becoming eligible for the critical illness benefit

23. CI Protect – Product Details • Use Life underwriting: • Uses Life insurance underwriting questions • One knock-out question • Life insured is considered as a standard risk for life insurance and has not been previously declined or rated for our Vital Link

24. CI Protect – Product Details • Knock-out question: • Have any of your biological mother, father, sister(s), or brother(s) been diagnosed before their 60th birthday with cancer, heart attack, coronary artery disease, stroke, diabetes, kidney disease, Huntington's disease or Parkinson's disease?

25. Competitive Products • Looked at 13 competitive products • 5 SI or Non-med CI T10 covering 3 to 6 critical illnesses • 8 Fully underwritten CI T10 covering 3 to 25 critical illnesses • Not 100% apple-to-apple comparisons • Foresters Health Security Plus – Adjustable premiums with 6 CIs plus ROPD • SSQ Assurance CI T10 Basic – Fully Underwritten with 3 CIs • RBC Simplified Issue CI – T10 to age 65 with 3 CIs • Manulife Lifecheque Basic – T5 with 5 CIs • Etc…

26. CI Protect – Initial Monthly Premium Comparisons • 1 Based on LIMRA Q1 2016 Individual Critical Illness Sales report, Industrial-Alliance is the market leader in sales of CI insurance products through the MGA channel. The initial premiums shown above are based on its Transition Simplified Issue 10 standalone product as quoted in LifeGuide on June 15, 2016.

27. CI Protect – Expected Competitive Rankings Note: Rankings are based on comparings between LifeGuide quotes on June 15, 2016 for initial monthly premiums of 13 CI products for the coverage amounts and life insureds indicated and the initial monthly premiums for Empire Life CI Protect for the same coverage amounts and life insureds. Comparison products are: BMO Insurance Living Benefit 10, Desjardins Harmony T10, Equitable Living Protection, Humania CI T10, Industrial-Alliance Transition Simplified Issue CI, ivari CI Protection T10, La Capitale Simplified Second Chance T10, Manulife Lifecheque T10, RBC Simplified Issue CI, RBC CI T10 NC, SSQ CI T10, Canada Life LifeAdvance T10 and Sun Life Sun CII T10, which may not have the same features as Empire Life CI Protect.

28. Fast & Full Life Application Process • Can apply for CI Protect through Fast & Full – one of most frequently requested enhancements

29. Fast & Full Life Application Process • CI Protect has been added to the Illustration Page in Fast & Full

30. Fast & Full Life Application Process • Family history knock-out question will appear on Quote Summary page if applying for CI Protect as a base plan

31. Fast & Full Life Application Process • If answers “yes” to knock-out question, a message will appear to indicate that client is not eligible

32. Fast & Full Life Application Process • If answers “no” to knock-out question, advisor/client can follow the application process to Beneficiary page Client can designate beneficiary(ies) for the critical illness benefit

33. CI Protect – Family Protection Case Study • John (age 35) is a healthy, non-smoker, married to Mary with two kids • John is the sole income provider. The family household income is $90,000 • He’d like to protect Mary and his children financially from any unexpected events

34. CI Protect – Family Protection Case Study • John worked with his advisor to create an insurance package to help protect his family Final Expense Income Protection Mortgage Protection

35. CI Protect – Family Protection Case Study • An affordable insurance solution package for John, age 35, standard non-smoker rate class: • EstateMax 100 - $50,000 with Enhanced option: • Base coverage of $27,724 • Enhanced coverage of $23,276 • Monthly premium = $33.96 Solution 10 rider of 350,000 Initial monthly premium = $15.44 CI Protect rider of 50,000 Initial monthly premium = $11.88 = Total initial monthly premium = $61.28

36. CI Protect – Family Protection Case Study • By adding CI Protect rider to the insurance package, for $11.88*/month, i.e. less than $0.40 a day, John can protect his family from the 4 most common critical illness conditions** - cancer, heart attack, stroke and coronary bypass surgery • The critical illness benefit can replace loss or reduction of income and help pay for: • Living expenses • Unexpected expenses, e.g. travel or child care, that aren’t covered by public or employer health plans • Etc. * Premium amount shown is the initial premium as of July 6, 2016, for $50,000 CI Protect rider of male 35 non-smoker. It will remain the same for the first 10 years and will increase every 10 years thereafter. ** Based on Munich Re 2014 Individual Insurance Survey.

37. Key Messages • Simple, Affordable Solution for Critical Illness Protection • Covers the four most common critical illnesses with affordable premium rates • A simple application process that uses life insurance underwriting with no additional health insurance requirements • Incorporates a coverage enhancement opportunity within our Fast & Full Life Application process

38. One more thing… • Empire Life Southwestern Ontario Roadshow • September 21 – Windsor • Caesars Palace, 9am to 12pm • September 22 - London • Cineplex Wonderland Rd, 9am-12pm • Registration link re-sent today or e-mail • Eufrazia.andrade@empire.ca

39. QUESTIONS? 39