Introduction managed by CI Investments Inc. issued by Sun Life Assurance Company of Canada
Agenda SunWise Essential Series design overview three Classes investment solutions Tools & marketing support
SunWise Essential Series A simpler, focused SunWise platform before highly customizable now a set of effective standard features that deliver a strong retirement and estate planning tools
The product
Introducing SunWise Essential Series Simplicity one contract covers all classes of units, which allows clients to consolidate accounts Three different classes of units to meet different needs: Income Class for guaranteed income for life Investment Class for wealth accumulation Estate Class for ensuring maximum estate value for beneficiaries
One contract three classes Income Class GLWB 100% Death Benefit 75% Contract maturity Selected income funds, balanced funds, Bundles, Portfolio Series Up to 70% equities Investment Class 75% Death Benefit 75% Contract maturity All funds, including Bundles and Portfolio Series Up to 100% equities Estate Class 100% Death Benefit 75% Contract maturity Income funds, balanced funds, Bundles, Portfolio Series Up to 70% equities
Contract level account Investment Class Income Class Age 60 61 62 63 64 65 66 67 68 69 70 All classes in one contract Maximize financial benefits Build your own portfolio One application One statement One tax slip
SunWise Essential Series Income Class
Changing retirement landscape 60% of Canadian workers have no employer pension 45% have no employer pension or RSP savings private sector pensions are being cut back CPP/QPP and OAS combined provide a retirement income of about 40% of the average wage clients will likely require a retirement income that s roughly 60% to 70% of their current level of income Source: StatsCan, average weekly earnings, 72-002-XIB; servicecanada.gc.ca for CPP and OAS payment rates for 2011; and The Globe & Mail seven-part series, Retirement Lost, October 2009.
The Retirement Risk Zone
Market risk Sequence of returns Source: Asset Allocation and the Transition to Income, Milevsky & Salisbury, September 2006.
The effects of market risk Will poor performance in the retirement risk zone change your client s plans?
Retirement risks inflation Purchasing power in 20 years $0.82 (1% inflation) $0.67 (2% inflation) $0.45 (4% inflation)
Retirement risks longevity
SunWise Essential Series Income Class Can help protect against the three retirement risks Market risk (sequence of returns) Inflation risk Longevity risk
Filling the gap For guaranteed retirement income SunWise Essential Series can help fill the gap * All amounts have been rounded. Based on 2011 maximum benefits at age 65, Canadian Pension Plan is $11,520 a year or $960 per month, and Old Age Security is $6,455.64 a year or $537.97 per month.
SunWise Essential Series Income Class target age 50+ for guaranteed, predictable income for life regardless of market performance annual 5% Income Bonus available for year of purchase and next 15 years ability to ensure income for life for one life or two lives, if spouses larger income with age-tiered withdrawals for those age 70 or older principal protection guarantees 75% contract maturity benefit at age 100 and 100% at death (reduced proportionately by withdrawals) additional benefits of insurance contract including potential creditor protection and ability to bypass probate
Guaranteed in all markets
5% Bonus for guaranteed growth
Investment gains locked in
Customized withdrawals Eligibility date: Jan 1 / 65 as a % of the LWA Base Option Jan 1 / 55 LWA Rate varies based on age of the Annuitant at time of initial Withdrawal, subject to quarterly proration * Based on the expected age of Annuitant on December 31 of the year of the LWA Commencement Date. Resets occurring in a higher age tier will result in an increase in the LWA Rate. If the client makes the Age 55 LWA Election, deposits before January 1 of the calendar year in which the Annuitant (or, if the Two-Life Income Stream has been selected, the younger of the Annuitant and the Second Life) turns 65 years of age the client will be entitled to GLWB Resets but will not be entitled to an increase in the LWA Rate if a GLWB Reset occurs at a time when a higher age tier would apply.
One-Life or Two-Life Income Stream Guaranteed income Rate Available on Based on One-Life Income Stream Starts at 5% of the LWA Base annually Jan. 1, year the Annuitant is age 65 or older (option to start at age 55, at 4%) Life of Annuitant (recalculated after annuitant s death) Two-Life Income Stream Starts at 4.5% of the LWA Base annually Jan. 1, year the younger spouse is 65 or older (option to start at age 55, at 3.5%) Life of the Annuitant and second Life
Guaranteed for one life or two
Income for one life or two
RRIF for life
Age 55 LWA Election Details Will be available to new and existing contract holders 4% for One-Life and 3.5% for Two-Life starting at age 55 No increase of the LWA Rate on GLWB Reset for deposits before age 65 if Age 55 LWA Election is made Any deposits made after age 65 will create a Blended LWA Rate and have the potential for an increase of the LWA Rate on GLWB Reset
SunWise Essential Series Income Class designed to mitigate market risk and protect retirement income eliminates longevity risk with guaranteed retirement income for one life or two lives, if spouse guaranteed growth of retirement income with annual 5% Income Bonus available for year of purchase and next for 15 years automatic GLWB resets every three years to capture potential growth and act as a hedge against inflation automatic death benefit resets every three years until age 80 age-tiered withdrawals for larger income later in life up to 70% exposure to equity funds (through Bundles) principal protection guarantees 75% contract maturity benefit at age 100 and 100% at death (reduced proportionately by withdrawals)
SunWise Essential Series Investment Class
SunWise Essential Series Investment Class target age under 50 for wealth accumulation maximum growth potential with 100% equities principal protection guarantees 75% contract maturity benefit at age 100 and 75% at death (reduced proportionately by withdrawals) potential creditor protection ability to bypass probate available investments include over 85 funds, including equity, income and balanced funds, SunWise Essential Bundles and seven Portfolio Series funds ability to combine the liquidity of Investment Class with the predictable income from Income Class within one contract
SunWise Essential Series Estate Class
SunWise Essential Series Estate Class target age 65+ for ensuring maximum estate value balanced investments for moderate growth principal protection guarantees 75% contract maturity benefit at age 100 and 100% at death ability to bypass probate and potential creditor protection available investments include more than 50 funds, including income funds, balanced funds, SunWise Essential Bundles and five Portfolio Series funds up to 70% exposure to equity funds (through Bundles) ability to combine the liquidity of Estate Class with the predictable income from Income Class within one contract (in case of emergency or unforeseen expenses, Estate Class units can be withdrawn instead of Income Class units so their income stream will not be impacted)
Death Benefit Resets The Death Benefit resets every three years, with the final reset in the year the annuitant turns age 80
Investments
Investments
SunWise Essential Series Bundles one or two funds combined with one income fund segregated bundles hold a traditional bond fund and an equity fund; segregated diversified bundles hold a diversified income fund and an equity fund designed to ensure the maximum 70% equity allocation based on the holdings of the underlying funds rebalanced monthly to ensure that the equity exposure is always maximized
How the Bundle rebalancing works The fund allocation of the Bundle mix is determined by the underlying security allocation of the equity fund 0% cash 30% cash
Client benefits SWE Bundle vs. underlying funds with 70/30 asset mix Source: CI Investment Consulting
Summary
Key benefits one account consolidated reporting for all classes guaranteed growth of retirement income guaranteed retirement income for one life or two lives, if spouses, regardless of market performance locking in of portfolio gains for income and death benefits larger income for clients who commence an income later in life tax-efficient for non-registered accounts income for life for RRIFs largest selection of segregated funds in Canada
The Sales Process simpler, focused 1 Choose protection type 2 Structure contract to fit financial objectives 3 Select investment strategy Income Class Investment Class Estate Class One-Life or Two-Life Income Stream beneficiaries balanced funds, Bundles fixed income to 100% equity income and balanced funds, Bundles
Private Investment Management World-class portfolio management and a broad choice of investments Enhanced accessibility $100,000 per mandate per account to receive preferred pricing Competitive pricing High-net worth pricing at $100,000, reduced for upper tiers Guaranteed income and estate planning Available in all classes of CI SWESS Consolidate and simplify across platforms Link mutual, corporate class and SWESS accounts for reduced pricing & consolidated reporting once one account has $250,000. True product allocation
Tools & support
www.sunwiseessentialseries.com Advisor support: www.sunwiseessentialseries.com four videos illustration tool marketing collateral information folder and administration documents case studies and a scenario guide a dedicated segregated funds specialist team
Thank You All charts and illustrations in this presentation are for illustrative purposes only. They are not intended to predict or project investment results. To the extent of any inconsistencies between this guide and the January 2012 SunWise Essential Series Information Folder and Individual Variable Annuity Contract, the terms of the Information Folder and Contract prevail. For full product details and disclosure, refer to the Information Folder and Contract. Sun Life Assurance Company of Canada, a member of the Sun Life Financial group of companies, is the sole issuer of the individual variable annuity contract providing for investment in SunWise Essential Series segregated funds. A description of the key features of the applicable individual variable annuity contract is contained in the Information Folder. Any amount that is allocated to a segregated fund is invested at the risk of the contract holder and may increase or decrease in value. CI Investments, the CI Investments design, Synergy Mutual Funds, Harbour Advisors, Harbour Funds, and Signature Global Advisors are registered trademarks of CI Investments Inc. Cambridge, Portfolio Series and Signature Funds are trademarks of CI Investments Inc. SunWise is a registered trademark of Sun Life Assurance Company of Canada. Fidelity Investments and the Fidelity design are registered trademarks of FMR Corp. RBC Asset Management is a registered trademark of Royal Bank of Canada. TD Asset Management is a trademark of The Toronto-Dominion Bank, used under licence. Dynamic Funds is a division of Goodman & Company, Investment Counsel Ltd. ( GCICL ). GCICL does not warrant or make any representations regarding the use or the results of the information contained herein in terms of its correctness, accuracy, timeliness, reliability, or otherwise. Franklin Templeton Investments, Franklin Templeton Investments Quotential Program and/or Franklin Templeton Investments and design are registered trademarks of Franklin Templeton Investment Corp.